AFRICA/NIGERIA - The Nigerian deputies open an investigation into the management of oil

Wednesday, 13 November 2013

Abuja (Agenzia Fides) - The House of Representatives of the Federation of Nigeria has begun an investigation regarding the Nigerian National Petroleum Corporation (NNPC), the state agency that handles foreign sales of Nigerian oil, after the publication of a report on behalf of the Swiss NGO "The Berne Declaration" in which the wrongdoings are denounced in the management of Nigerian crude oil exports and imports of refined petroleum products.
In the report, entitled "Swiss traders' opaque deals in Nigeria", the NNPC is called "the most opaque national oil partner in the world" which since 2005 does not publish a detailed financial statements. The document emphasizes among other things how Nigeria, despite being a major oil producer, is forced to import fuel because of the decay of its refineries. Both in the cycle of production and export of oil (typically called upstream and midstream) and in the refining and import of petroleum products (downstream) the NNPC is supported by some trading companies based in Switzerland.
The report denounces the selling below market to two Nigerian oil trading companies based in Geneva, by the NNPC branches established in Bermuda. The two companies then resell the oil at full price on international markets. Who gets the revenue generated by speculating on the price difference?
The document then states that between 2009 and 2011, the Nigerian government shelled out $ 6.8 billion in "unjustified subsidies" to control the price of fuel.
The Nigerian Bishops have repeatedly denounced waste and embezzlement linked to the exploitation of oil and the fact that the profits generated from the sale of crude oil are not used to the advantage of the people. (see Fides 13/11/2006, 28/12/2006 and 16/1/2012). (L.M.) (Agenzia Fides 13/11/2013)