An audit report from Nigeria’s Office of the Auditor-General has uncovered a troubling financial situation at the Nigerian National Petroleum Company Limited (NNPCL) in 2021, with irregularities amounting to N515 billion. This investigation sheds light on how the company handled funds, pointing out several mismanagement issues during the year.

The report details four major infractions. One of the biggest problems involved N343.64 billion being deducted from domestic crude oil sales without proper justification. These deductions were for costs related to pipeline management, stockholding, and other expenses, but there was no clear explanation provided for why the money was taken.

Additionally, NNPCL was found to have warehoused N83.66 billion in a sinking fund account, and another N82.95 billion was deducted from the Federation’s revenue for refinery rehabilitation. On top of that, an unverified N3.75 billion was paid in relation to the sale of petrol, which was also flagged as suspicious.

In May 2021, the audit found that NNPCL failed to remit N50 billion to the Federation Account, as it only paid N77.075 billion instead of the expected N127.075 billion from domestic crude sales. The report suggests that these discrepancies stemmed from weak internal controls within the company, leading to potential losses for the government and misuse of public funds.

These irregularities took place before NNPCL was restructured into a commercial entity, now known as NNPCL, in 2022. Despite the financial issues in 2021, NNPCL announced a remarkable N3.3 trillion net profit for 2023, highlighting its recovery since then.