Former Vice President Atiku Abubakar has condemned President Bola Tinubu’s directive to the Central Bank of Nigeria to take responsibility for the crude oil sales revenue of the Nigerian National Petroleum Company Limited (NNPCL).
In a statement he signed on Thursday, Atiku called the directive illegal and that it undermines the operational independence of the national oil company.
President Tinubu reportedly asked the NNPCL to send its crude oil sales receipts to the CBN for investigation and documentation.
The directive was reportedly aimed at ensuring accountability and transparency.
Atiku, who was the presidential candidate of the People’s Democratic Party (PDP) in the 2023 elections, said whatever the merit of President Tinubu’s action, it violates the legal status of the NNPCL.
He maintained that through the order, the president had wrested control of the state oil company’s finances and handed them over to the CBN.
“Whatever the merit of the new agreement, the presidential directive is a violation of the legal status of the NNPCL.
“It is an arbitrary order capable of undermining the operational independence of the NNPCL.
“With this order, Mr. President has wrested control of the finances of the NNPCL and donated them to the Federal Ministry of Finance and the Central Bank of Nigeria,” he said.
The former vice president said state-owned enterprises are not subject to such arbitrary orders and have full control over their finances within the confines of their respective establishment laws.
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He warned that “any attempt to undermine the operational independence of the NNPCL would be an obstacle to any possibility of attracting investments and achieving global relevance in the oil industry.”
Atiku said the CBN should be allowed to perform its basic functions as provided in the existing law.
Read the full statement:
PRESS RELEASE
FG’s directive to CBN to take over NNPCL’s crude oil sales revenue is not legal and undermines the operational independence of the national oil company
Without prejudice to the possibility of any good intended in the decision of the Federal Government to make the Central Bank of Nigeria (CBN) assume responsibility for the crude oil sales revenue of the Nigerian National Petroleum Company Limited (NNPCL), It must be clearly stated that the action is not legal in its application.
Although, as is usual in the current administration, little has been communicated to the public about explaining details of the decision.
According to what is publicly available, the President has issued a directive that NNPCL will henceforth submit receipts of crude oil sales to the CBN for investigation and documentation.
Whatever the merit of the new agreement, the presidential directive is a violation of the legal status of the NNPCL.
This is an arbitrary order capable of undermining the operational independence of the NNPCL.
By this order, Mr. President has wrested control of the finances of the NNPCL and donated them to the Federal Ministry of Finance and the Central Bank of Nigeria.
This is an unprecedented act, without any legal or ethical basis. It is also a violation of the principle of due process in public administration.
State-owned enterprises are not subject to such arbitrary orders and have full control over their finances within the confines of their respective establishment laws.
The NNPCL is a creation of the Petroleum Industry Act, 2021 (PIA), which was signed into law by the President of the Federal Republic of Nigeria on August 16, 2021.
The PIA makes extensive provisions for the formation, structure, governance and functioning of NNPCL as an independent limited liability company in sections 53 to 65 of the Act.
Therefore, the government must respect the provisions of the law and allow NNPCL to function as an independent company based on sound business objectives and in line with international best practices and standard corporate governance principles.
Only then would the new NNPCL become a formidable institution with a track record, the necessary technical and financial capacity and willingness to operate in the public space.
Any attempt to undermine the operational independence of the NNPCL will be a hindrance to any chance of attracting investments and achieving global relevance in the oil industry.
It should also be noted that the Central Bank Act 2007 does not confer on the Central Bank of Nigeria any responsibility to review transactions or formulate and maintain internal controls and internal audits in state-owned enterprises, public or private.
The CBN should be allowed to perform its core functions as provided in the existing law.
To enhance transparency and accountability in the functioning of the NNPCL, its bank accounts for crude oil sales revenue (e.g. at Morgan Stanley) and the entire crude oil sales conversion circle can be tracked by the Initiative. for Nigerian Extractive Industry Transparency (NEITI) and the CBN.
Among other supportive measures to improve transparency, NNPCL board members can be better selected and reconstituted to include, if desired, representatives from the CBN and NEITI.
Atiku AbubakarVice President of Nigeria, 1999-2007February 1, 2024.