NNPCL’s N7.1tn question: Why transparency must follow the money

By ADETUNJI ROGERS

The latest scrutiny of N7.13 trillion recorded by the Nigerian National Petroleum Company Limited (NNPC Ltd) as an energy-security expense in 2024 has reignited familiar questions about the national oil company’s financial accountability.

According to NNPC Ltd’s 2024 audited financial statements, the expenditure arose from a mechanism linked to the difference between the exchange rate used to freeze the ex coastal price of Premium Motor Spirit and the prevailing exchange rate when imports were settled. The company said the amount was receivable from the Federation and charged against amounts due to it under the Petroleum Industry Act. The broader “energy security cost” category also included expenditure relating to the protection of oil and gas assets.

The controversy, therefore, is not necessarily that NNPC spent money on energy security. Nor does the figure, standing alone, establish that funds were stolen or misappropriated. The more important question is whether the public can understand what the N7.13 trillion represents, how it was calculated, what specific expenditures it contains, who authorised them and what value was delivered in return.

That is where transparency becomes non negotiable.

The issue has acquired greater significance amid wider scrutiny of NNPC’s finances, including the separate controversy over more than N210 trillion in receivables and payables described as unreconciled in audit related scrutiny. The two matters are separate and should not be conflated. But both underline the same institutional principle: the larger the figures, the more detailed the explanation required.

The N7.13 trillion energy security expense is therefore better understood as a corporate governance and public accountability question, rather than automatically as a corruption case. Energy security can encompass ensuring the availability, accessibility and affordability of energy, protecting infrastructure and strengthening supply chains. The central questions are whether the expenditure was properly classified, transparently disclosed, economically justified and capable of demonstrating measurable value.

For an institution managing some of the country’s most strategically important commercial assets, those questions should be answerable without ambiguity.

The same principle provides a useful lens through which to examine historical allegations involving the former Nigerian National Petroleum Corporation, including an alleged $153.31 million transaction dating back to the period when NNPC operated as a statutory corporation.

The allegation is significant because the funds were reportedly taken from NNPC for election funding-a purpose entirely outside the corporation’s statutory and commercial mandate. If established, it would not represent an ordinary operational expenditure falling within the routine authority of executive management.

The question, therefore, is not simply who held the most senior political office at the time. It is: how could a transaction allegedly outside NNPC’s mandate have been authorised and executed?

During the period in question, former Minister of Petroleum Resources Diezani Alison Madueke served as chairperson of the NNPC board in her ministerial capacity. Dr Joseph Thlama Dawha was Group Managing Director, having succeeded Andrew Yakubu in August 2014. Bernard O. N. Otti served as Group Executive Director, Finance and Accounts. Other senior professionals included Dr Dan Iwone Efebo, Group Executive Director, Corporate Services, and Ikechukwu Oguine, Coordinator of Legal Services and Secretary to the Corporation.

The corporation operated through multiple layers of finance, treasury, legal, procurement, audit and executive management. It was not a one person operation in which a major financial transaction could simply be initiated, approved and executed by one office holder.

Moreover, a transaction allegedly involving the use of NNPC funds for election financing would, by its nature, fall outside the ordinary scope of executive management. If such an allegation were established, the question would extend beyond routine corporate approval and raise the issue of authority at the highest level-including whether presidential authorisation was required.

This makes the approval chain central to any serious examination of the allegation.

If the funds originated from NNPC, why has the public record not clearly identified the originating NNPC account, the internal authorisation trail, every NNPC official involved in the transaction, the authority under which the funds were released and the institutional control failures that allegedly permitted the movement of the $153.31 million?

There is also a broader institutional question. If NNPC was accused of diverting funds for a purpose entirely outside its mandate, why did the institution not more forcefully defend its own institutional position? Why was there not a clear public explanation of whether the alleged transaction originated from NNPC, whether it was authorised within the corporation and whether it was consistent with its statutory responsibilities?

This raises an uncomfortable possibility: has NNPC become so burdened by the political weight of successive administrations that it has become increasingly difficult to distinguish between corruption allegations involving the institution and political accusations directed at the government of the day? 

The question is not an argument that wrongdoing could not have occurred. It is a question about the evidentiary chain necessary to establish responsibility-and about the institutional responsibility to clarify its own role when its name is placed at the centre of serious allegations.

The same principle applies to the current N7.13 trillion controversy. A corporate expense may be legitimate and still require detailed public explanation. An accounting entry may be properly recorded and still demand scrutiny. Transparency is not an admission of wrongdoing; it is what allows legitimate expenditure to be distinguished from improper expenditure.

This is particularly important for NNPC Ltd because its finances intersect with public revenue, national energy policy and the Federation’s obligations. The company may operate as a limited liability company, but its strategic role and financial relationship with government mean that public confidence remains central to its legitimacy.

Whether the issue is energy security expenditure, an accounting discrepancy, a disputed reconciliation or an alleged diversion of funds, the public deserves to know what the money represents, where it came from, where it went and which institutional controls governed the process.

Recent legal developments concerning Alison Madueke also reinforce the need for precision. Allegations, investigations, charges and judicial outcomes are not interchangeable. Historical claims must be assessed alongside the evidence and subsequent legal developments relevant to them.

Ultimately, the N7.13 trillion question need not be framed as proof of corruption to be important. It is important precisely because it demonstrates why NNPC Ltd must make its internal processes sufficiently transparent for the public, auditors and oversight institutions to understand the financial logic behind extraordinary expenditures.

The same standard should apply to every major allegation involving the national oil company.

Accountability is strongest when it is based not on the repetition of alarming figures, but on clear records, traceable approvals, identifiable responsibility and due process.

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