The NNPCL only released its 2022 financial statements in January 2024 after facing significant pressure. The Petroleum Industry Act mandates that the NNPCL, as a limited company, must undergo financial audits annually, in line with the Companies and Allied Matters Act.
The Nigerian National Petroleum Company Limited (NNPCL) has not published its financial records for 2023, as the year 2024 draws to a close.
This lack of transparency has sparked concerns about the company’s operations, especially since it became a limited company.
The NNPCL only released its 2022 financial statements in January 2024 after facing significant pressure. The Petroleum Industry Act mandates that the NNPCL, as a limited company, must undergo financial audits annually, in line with the Companies and Allied Matters Act.
Oil revenue is a significant contributor to the Nigerian government’s fiscal intake, serving as a crucial indicator of revenue generation.
The company is an Incorporated Joint Venture owned in the following proportions: Nigerian National Petroleum Company Limited (NNPC) (49%), Shell Gas B.V. (25.6%), TotalEnegies Gaz & Electricité Holdings (15%), and Eni International N.A. N.V. S.àr.l (10.4%).
However, the financial performance of the NNPCL remains opaque, with Nigerians unable to access its financial statements and gauge its fiscal health.
Previous financial statements of the NNPC have raised concerns regarding the organisation’s financial management and the stewardship of the country’s oil revenue.
A review of the 2021 financial statement highlighted several issues, including high indebtedness. Notably, the NNPC wrote off debts amounting to N140 billion over a three-year period between 2019 and 2021, raising questions about its financial prudence and revenue management practices.
One of the NNPC subsidiaries gave out loans worth N2 billion to employees despite recording zero profit in 2021.
Previous financial statements reveal that the NNPC has been funding loss-making subsidiaries, raising concerns about its operational efficiency. Additionally, the NNPCL has secured various crude-backed loans, including a $3 billion loan in 2023, the impact of which on the company’s revenue and operations remains unclear.
Furthermore, the Nigerian Extractive Industry Transparency Initiative (NEITI) has alleged that the NNPCL failed to remit N2.8 trillion in taxes to the government in 2022, highlighting potential revenue management issues.
While the NNPCL continues to state that it is committed to accountability, experts note that publishing financial statements was a key pointer to such commitment.