NNPC: Senate Wades into Insolvency Controversy


From Kunle Akogun in Abuja, 07.16.2010 


The Senate yesterday waded into the controversy surrounding the solvency or otherwise of the Nigerian National Petroleum Corporation (NNPC), asking its Committees on Petroleum (Upstream and Downstream) to find out the true position and report back in a week’s time.


This followed a point of order raised by Senator John Shagaya (PDP, Plateau) on a matter of urgent public importance.Shagaya called the attention of his colleagues to newspaper publications on the statement credited to the Minister of State for Finance, Mr. Remi Babalola, that the nation’s cash cow, NNPC, is insolvent and unable to meet most of its financial commitments.


He also referred to the disclaimer by the Federal Executive Council (FEC) of Babalola’s statement, claiming that the corporation’s finances are not in the red.Babalola had on Tuesday said, “NNPC is insolvent, as current liabilities exceeded current assets … NNPC is incapable of repaying the N450 billion owed to the Federation Account unless it is reimbursed the N1.156 trillion (in subsidies) it has requested from the Federal Ministry of Finance”.


But NNPC and the Federal Government have put a lie to Babalola’s submission. While the NNPC denied it is insolvent, the Federal Government through Information and Finance Ministers at the end of Wednesday’s FEC meeting said the corporation was not insolvent and stressed that it was still strong enough to carry on with its statutory obligations.


Shagaya said these conflicting statements portend grave dangers to the nation’s economy. He disclosed that “as a result of the publications many senators have received phone calls from people expressing worries that not only the NNPC but the entire country may indeed be insolvent”.He said many commentators tend to believe what the minister of state had said, adding that “because of the seriousness of the matter, the Senate should discuss it”.


Senate President David Mark agreed with Shagaya that the matter is a serious one but observed that since nobody has any fact on it now, any debate on it now would be ill-informed.He therefore directed the two Senate committees on Petroleum (Upland and Downstream) headed by Senators Lee Maeba and Paulker Emmanuel respectively to go and find out the truth and report back to the Senate in a week’s time.


“The committees should call all the parties involved in the controversy for briefing”, Mark said, explaining, “we are not asking the committees to go and probe NNPC but to go and find out the true position of things and you can do that in two or three days”.Lamenting the contradictory statements from a minister and the Federal Government of which he is a key member, the Senate President said “the discordant note from the Executive is very unfortunate; they should go and iron out their differences”.


In a brief remark before he was cut short by the Senate President, Maeba (PDP, Rivers), recalled his committee’s consistent observation that all is not well with the NNPC. “We have been saying it that NNPC is in trouble”, Maeba said.





Comments are closed.