Reps order NUPRC, NBET, PTAD to submit financial records
The joint sitting of the House Committee of the House of Representatives Committee on Finance and the Committee on National Planning have directed the Nigeria Upstream Petroleum Regulatory Commission (NUPRC) to provide all details of oil production, crude sales and other activities in the upstream petroleum industry in the country to the joint committees.
The directive was given after a presentation by the NUPRC Executive Commissioner Economic Regulation & Strategic Planning (ECR&SP), Mr. Babajide Oluwole Fasina who represented the Chief Executive Officer (CEO) of the organisation, Gbenga Olu Komolafe accompanied by some members of its management at the ongoing interactive session with key agencies on the 2025-2027 Medium Term Expenditure Framework (MTEF) and Fiscal Strategy Paper (FSP).
Mr. Fasina had informed the Committee that, that NUPRC derive its various revenues from oil royalty, gas royalty, concession rental, gas flat penalty, miscellaneous oil revenues which include fines and levies, signature bonus and renewal of licenses.
Giving a highlight of the revenue collections he said that, NUPRC gets 4% Cost Of Revenue Collection (CORC) for the total revenue collected on behalf of the federal government which he said were credited directly to the Federation Account and FAAC credits the 4% to the Commission.
“The Cost Of Revenue Collection amounted to N114.84 billion in 2023 as against N114.38 billion in 2022. The amount released in 2023 includes N2.82 billion for Capital Expenditure, though N173.77 billion was due as 4% on the Actual Collections of N14.34 Trillion in 2023.
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“The Commission also generates revenues internally such as, Registration Fees, Licence Fees, Fines, Recoveries, etc. It generated N1.44 billion in 2023 compared to N30.08 billion in 2022, and this accounts for 1.26% of the total Revenue realized in 2023 and 2.62% in 2022 respectively,” Mr. Fasina said.
He however informed the Committees that, the Commission recorded a high expenditure in 2023 compared to 2022 by N11.46 billion which he said was an increase of 10.83%.
“Personnel Cost which has the largest share amounting to N82.35 billion represents 70.19% of the total expenses of N117.33 billion, followed by Overhead Costs of N31.63 billion which accounts for 26.96 billion,” he said.
The NUPRC Executive Commissioner however informed that, the Commission’s non-tax remittance dropped from N3.67 billion in 2022 to N1.77 billion in 2023 and an Amorisation and Depreciation of N246.66 million and N1.33 billion respectively.
The Chairman of the Committee on Finance, Mr. James Abiodun Faleke who presided over the session and members were displeased by the Commission’s Personnel and Overhead expenditure as stated by its official as contained in the documents presented before the Committee.
“So if only your agency is spending 88 billion. That’s why you have so much. So much money.Because of 4% collection. 4% is too much. We need money…you are spending 88 billion on personnel, and you are spending 40 something billion on overhead,” Faleke said.
The Committee rejected the NUPRC’s explanation and demanded a comprehensive records from the Commission as regards its revenues, expenditure and all other activities including exploration activities of Frontier Explorations’ at various Frontier Basins in the country where oil prospecting activities are taking place.
In his ruling, Chairman of the Committee, James Faleke said, “You are going to come back with all the records of all the wells that produce the oil litre by litre per day. How much oil we get from here everyday.
“You are going to come back with records of shipments of crude either daily or weekly at what rate. You are going to come back with proposals of 2025 as to the expectations of two million five barrels per day, 2.06 million per day.
“And you reach out to the Frontier or whatever you called them. You come together with them and must come with the records of all Frontier activities, expenses incurred, crude oil realised from there and of course the sales proceeds and add what the Frontiers are doing.
The day they started and how far they have gone. You must come here with them on the 18th. We expect you here on the 18th by 11am.”
Similarly, the Committee also directed the Nigeria Bulk Electricity Trading (NBET) PLC to provide more specific details on its budget performance and other activities in the electricity market.
The agency has in its submission in the documents it presented informed the Committee about the ‘reason for disparity between Generation Companies (Gencos) invoices and amount invoices to Distribution Companies (DisCos).
The agency’s documents stated, “NBET invoices DisCos before receiving and verifying GenCo invoices as required by the settlement Calendar. This timing difference means that components such as interest and True-Up, which are included in GenCo invoices cannot be reflected in the invoices sent to DisCos, Consequently, the mismatch in timing leads to discrepancies in the amounts invoices.
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“Apart from the DisCos, other off-takers such as Ajaokuta Steel Company and Net Importer Generation Companies are included in the invoicing process. The inclusion of these off-takers introduces further complexities that contribute to the disparity between actual invoices and the amounts invoices to DisCos.
“The supplementary order under the Transitional Electricity Market (TEM) framework mandates the use of specific Tariff for invoicing Net Importer GenCos. These Tariff requirements create additional differences between the amounts invoices to GenCos and those passed on to DisCos.”
Other details about budget performance as well as the operations of the electricity market were also presented by NBET in the documents presented.
However, the Committee after the presentation requested for more specific documents containing more details.
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