Abuja, Nigeria — The Office of the Auditor-General for the Federation has fired a warning shot straight into the heart of Nigeria’s petroleum ecosystem, uncovering ₦61.1 billion in unexplained payments, undocumented expenditures, and blatant breaches of financial regulations within the Nigerian National Petroleum Company Limited (NNPCL).
The revelations come from the Auditor-General’s 2022 Annual Report on Non-Compliance (Volume II), which examined NNPCL’s operations in the 2021 fiscal year. The document, now in the hands of the National Assembly, highlights 28 major red flags that expose the oil giant’s internal control systems as disturbingly weak.
According to the Auditor-General, the pattern is not random — it is systemic.
“Where documents were not provided, payments were unjustified. Where approvals were absent, expenditures breached the law,” the report declared.
This is not a one-off scandal. It adds to years of unresolved audit indictments that have dogged the company.
A London Office That Spent £14 Million — With Zero Documentation
One of the most stunning audit findings involves the NNPCL’s London Office, which spent £14,322,426.59 — over ₦8.5 billion — but reportedly failed to provide a single document showing how the funds were utilized.
The breakdown of the spending included:
- £5.94 million in personnel costs
- £1.44 million in fixed contract and essential expenses
- £6.94 million in “other operational costs”
Not one invoice. Not one voucher. Not one schedule. Auditors said they were not granted access to supporting documents, nor were they able to verify any of the expenditures.
This constitutes a direct violation of Nigeria’s Financial Regulations (2009), which demand complete documentation for all public expenditure. Paragraph 603(1) states that every payment must be backed with details — dates, quantities, invoices, and approvals — to allow verification without special requests.
NNPCL management, in its response, insisted that the London Office operates with an approved annual budget and keeps detailed records. It claimed the audit query did not specify which line items were being challenged.
The Auditor-General rejected this explanation as “unsatisfactory,” insisting the query remains open until full documentation is provided and corrective actions implemented.
The recommendation is blunt:
- The GCEO of NNPCL must appear before the Public Accounts Committees.
- The entire £14.3m must be recovered and remitted to the Treasury.
- Failure to comply should trigger sanctions under the Financial Regulations.
Foreign Currency Payments: €5.17m With No Contract, $51.6m With Red Flags
The audit further uncovered €5,165,426.26 paid to a contractor without evidence of any engagement — no contract, no documented relationship, nothing.
Dollar payments also raised multiple alarms:
- $22,842,938.28 — Unsubstantiated Direct Sales Direct Payment (DSDP) settlements.
- $12,444,313.22 — Delayed generator procurement at Mosimi depot.
- $1,801,500 — Irregular contract extension for a bunkering vessel.
- $2,006,293.20 — Provisional payments without invoices.
- $1,035,132.81 — Paid to a company without a power of attorney.
In total, $51,674,020.15 in foreign currency transactions were flagged for irregularities.
Domestic Infractions: ₦30.1 Billion in Questionable Payments
On the naira side, the report paints an equally troubling picture — payments without approvals, missing documents, abandoned projects, and unauthorized virements.
Key issues include:
- ₦12.721 billion — Non-remittance to NNPCL’s General Reserve Fund.
- ₦3.445 billion — Paid by the Chief Financial Officer without GMD approval.
- ₦2.379 billion — Irregular status-car cash options to staff.
- ₦1.212 billion — Contractor payments made without invoices or interim certificates.
- ₦474.46 million — Spent through unauthorized virements.
- ₦355.43 million — Demurrage and brokerage on abandoned refinery cargoes.
- ₦292.6 million — An Accident & Emergency hospital project left abandoned after mobilisation.
- ₦246.19 million — Paid for a contract with no proof of execution.
- ₦46.2 million — Withholding tax under-deducted and unremitted.
- ₦6.246 billion — Payments made without supporting documents across MDAs.
- ₦1.365 billion — Processed through illegal virements.
Total domestic irregularities: ₦30,115,474,850.85.
Procurement Abuse: The Vessel That Cost Nigeria $1.9 Million Extra
Auditors also uncovered a serious breach involving a time-charter agreement originally signed for MT Breeze Stavanger at $19,532/day. Only six months into the contract, the contractor claimed the vessel was unavailable and replaced it with MT Alizea, billed at $21,643.23/day.
This unauthorized substitution ballooned costs by $1.926 million over 30 months.
Under the original agreement, if the vessel failed to meet specifications, the contractor — not NNPCL — was responsible for replacement at their expense.
The audit labelled it an “irregular adjustment that exposed public funds to unnecessary risk.”
Civil Society Reactions: “NNPCL Is a Cabal Untouchable by Anti-Graft Agencies”
Anti-corruption groups reacted sharply.
The Centre for Anti-Corruption and Open Leadership (CACOL) described NNPCL as the “strongest cabal in Nigeria,” alleging that government officials routinely shield the corporation from scrutiny.
The Civil Society Legislative Advocacy Centre (CISLAC) blamed the lack of accountability not only on NNPCL leadership but also on oversight bodies — including the Presidency and National Assembly.
A Test Case for Transparency Under the PIA
These infractions occurred under the leadership of Mele Kyari, who served as GCEO from 2019 until his recent removal. He has since been replaced by Bayo Ojulari.
As NNPCL attempts to operate as a commercial entity under the Petroleum Industry Act, the audit serves as a harsh reminder that structural transformation on paper does not equal transparency in practice.
Nigerians are watching closely to see whether this audit triggers actual accountability — or quietly becomes another forgotten document.