Nigeria 'missing millions'

[bhk]

http://www.fin24.co.za/articles/defa...518-25_1915080

11/04/2006 20:04 PM

Abuja - An audit of Nigeria's oil industry showed on Tuesday discrepancies amounting to hundreds of millions of dollars between what oil companies say they paid the government and what authorities say they received.
The auditors stopped short of suggesting what could have happened to the cash, but their report raises questions about accounting standards and corruption in the world's eighth biggest exporter of crude oil.

The audit, commissioned by the government-backed Nigerian Extractive Industries Transparency Initiative (NEITI), looked at physical and financial flows from 1999 to 2004 and was unable to reconcile figures provided by oil firms and the central bank.

Strange situations

"We found some strange situations. For the year 2002, there were $250m that the companies say they paid to the central bank that do not appear in central bank records," said Chris Nurse, managing director of audit firm the Hart Group.

There were anomalies in other years and there were also discrepancies between figures provided by different arms of government, the audit showed. Nurse said accounting standards were low in all the government agencies that were audited.

"It's worrying that book-keeping standards are low but what is more worrying is that this makes it easy for those who engage in corrupt practices to hide," said a member of a parliamentary committee on corruption, who did not wish to be named.

Oil and gas revenue accounts for more than 80% of Nigeria's annual budget and critics of the secretive industry blame it for fuelling systemic corruption in Africa's most populous country.

The NEITI is part of efforts by the government of President Olusegun Obasanjo to tackle Nigeria's reputation as one of the most corrupt countries - the sixth worst in the world, according to independent watchdog Transparency International.

Obasanjo has combined the role of president with that of oil minister since taking office in 1999.

Almost all of Nigeria's 2.4 million barrels per day is pumped by multinationals Royal Dutch Shell, Exxon Mobil, Chevron, Total and Agip in joint-ventures with the state oil company.


What happens next?

The Hart Group audit investigated how much money was generated by the industry and how much was known to have landed in government coffers, but the auditors did not have a mandate to look into what happened to the money after that.

"The NEITI is a good initiative but there is a lot more that we need to know," said Assisi Asobie of Transparency International.

"What is government doing with the money? How much is going to the states and what are they doing with it?" he asked.

Oil revenue is shared between the federal government and Nigeria's 36 states. The federal government frequently accuses states of embezzling the money, while states make similar accusations against the central government, but neither can do much about it because the president and the state governors are all immune from prosecution.

Nurse said that as well as uncertainty over financial flows, there were problems in the way physical volumes of crude oil were measured. There was good data on how much oil reached export platforms but almost no data on how much was originally pumped from oilfields.

This is problematic because vast amounts of crude are stolen along the way in the oil-producing Niger Delta and Nurse said it was impossible to determine how much oil was missing.

Oil industry officials estimate that Nigeria loses about 100 000 barrels a day, or 5% of its output, to a highly sophisticated international network of oil thieves.

That's because the wife of the former president has the money stashed in a bank account that she can't get to because they froze the account when her husband died. She says that if I send her my bank account number, she'll wire all of the money to me, and then I can keep twenty percent. I'm going to be rich!!!

[Vibiana]

Don't forget us when you're a bazillionaire.

[Tracer Bullet]

Originally Posted by bhk

That's because the wife of the former president has the money stashed in a bank account that she can't get to because they froze the account when her husband died. She says that if I send her my bank account number, she'll wire all of the money to me, and then I can keep twenty percent. I'm going to be rich!!!

But she said that to me...

[kvrdave]

I screwed them over and now they will dead me. They know the mayor.