The World Bank has accused the Nigerian National Petroleum Company Limited (NNPCL) of inconsistent and non-transparent reporting to the Federal Account Allocation Committee (FAAC). According to Naija News, the concerns were raised in the World Bank’s Accelerating Resource Mobilisation Reforms (ARMOR) report, dated May 17, 2024.
The report highlighted that the lack of transparency in NNPCL’s governance has disrupted the flow of oil revenues to Nigeria’s federation, further compounding the nation’s fiscal challenges. Inconsistent reports submitted by NNPCL lack key details such as pledged revenues, tradeable crude value, and receipts from global trade, making oversight difficult. The report also noted that quasi-fiscal activities, such as in-kind payments with crude oil, reduce the funds transferred to the Federation Account.
Despite the 116% rise in global oil prices between 2020 and 2023, oil production fell to 1.4 million barrels per day (mbpd) due to insecurity and underinvestment, leading to lower revenues. The World Bank also criticized NNPCL’s commitment to supply 35,000 barrels of crude daily for a stake in the Dangote Refinery, noting discrepancies between projected and actual reported returns. The report warned that NNPCL’s practice of retaining oil revenues for projects like the gas pipeline to Morocco further limits government income.