NNPC Committed to Prompt Remittances to Federation Account, Says CFO …Pledges support for Agip on cash-call repayment

The Nigerian National Petroleum Corporation (NNPC) has restated its commitment to the prompt payment of proceeds from its operations to the Federation Account and steady supply of petroleum products to Nigerians.

This was disclosed by the Chief Financial Officer (CFO) of the Corporation, Mr. Umar Ajiya, at a strategy session with the heads of Account Department of the corporation’s subsidiaries at the NNPC Towers, Abuja.

NNPC has also promised to work closely with Agip to speedily resolve all pending issues that led to the suspension of cash-call repayment.

A statement issued on Wednesday by the corporation’s Group General Manager, Group Public Affairs Division, Mr. Ndu Ughamadu, in Abuja, stated that the meeting was part of the initiatives to rally the corporation’s business leaders in support of the new management’s agenda. 

Ajiya stated that the strategic role of Account Directorate was crucial to the realization of the new GMD’s goals and objectives, stressing that there was need for all managers of accounts to improve on deliverables.

"This important meeting is to ensure that the management of Finance and Accounts Directorate corporate-wide are properly briefed on the direction of the new NNPC management and work as a team to deliver on the GMD’s commitments to the nation among which are: paying what is attributable to the federation by way of FAAC remittances and meeting up with obligations to all stakeholders as and when due," he said.

The CFO listed eight key areas where the Accounts Directorate can help in actualizing the GMD’s agenda to include: liquidity management; financing for growth; business process improvement, budget and budgetary controls payment system, cost control/discipline, real-time financial reporting, capacity building, autonomy for SBUs, and maintenance of pension funding.

He stated that the GMD’s mandates and commitments have financial implications and pointed out that the directorate was looking ahead and ready to implement the Direct Debit and Cash Sweep mechanism to grow other businesses for a more viable corporation.

He explained the Direct Debit and Cash Sweep concept as system whereby, "the corporate has the right to debit SBUs with excess cash flow by cash-sweeping the excess for the purpose of investing in other SBUs by way of inter-company loan or equity contribution. This way, we can grow the several businesses to their full potentials."

Mr. Ajiya disclosed that under his watch, SBU autonomy would be enhanced, adding, however, that such freedom must be tied to the responsibility of going beyond self-funding to contributing to the general purse.

He equally charged his team to embrace process automation for their individual Strategic Business Units (SBUs).

Meanwhile, NNPC has promised to work closely with Agip to speedily resolve all pending issues that led to the suspension of cash-call repayment.

The Group Managing Director (GMD) of the corporation, Mallam Mele Kyari, made the commitment on Tuesday during a business visit by delegation from ENi/Agip led by the Executive Vice Chairman, Sub-Saharan African Region and Chairman ENI Exploration and Production in Nigeria, Mr. Brusco Guido.

According to a separate statement by Ughamadu, the NNPC boss explained that the failure to pay cash call arrears in the last three months was deliberate and meant to ensure that the issues surrounding the agreement settled.

 "The money is there, it is ready. We will pay as soon as the issues are resolved by the end of the week," Mele Kyari stated.

On the issue of some of the expired assets, the GMD explained that there was no immediate plan to renew the licenses as the Federal Government was interested in having the exploration and production arm of the NNPC, the Nigerian Petroleum Development Company (NPDC) operate them.

On the Okpai Independent Power Project, Mele Kyari, explained that the issues that led to the delay in payment have been resolved, saying payment would be effected as soon as possible.

"We will work with you. You can count on us," he assured the Agip team, urging them to fast-track the Phase 1 of the rehabilitation of the Port Harcourt Refinery to ensure that it was delivered before the scheduled date of October 2019.

Speaking earlier, the Executive Vice Chairman, Sub-Saharan African Region and Chairman ENI Exploration and Production in Nigeria, Mr. Brusco Guido, said the company was fully aligned with the GMD’s three-point agenda of growing reserves, growing production, and cutting cost.

He, however, listed a number of challenges that had hampered its operation and urged the NNPC management to help resolve them in order to meet its target of growing production from the JV assets by 30% over last year’s rate.