The Nigerian National Petroleum Corporation (“NNPC”) has contested the ongoing probe by the Nigerian Senate (the “Senate”) into its rights to withdraw funds from the Nigeria Liquefied Natural Gas Limited (“NLNG”) dividends account (“Dividends Account”).
The issue in question is whether the NNPC is authorised to utilise revenue derived from the NLNG to finance its activities. The Senate announced on 15 November 2018 that it had discovered US$1.05 billion of illegal withdrawals from the NLNG Dividends Account and pursuant to this, the Senate Committee on Gas, further declared that it would be looking into the operations of the NLNG from 2015 to date. The NNPC responded that it is a majority shareholder in the NLNG and as a result, stated that there is nothing illegal about the withdrawals made from the Dividends Account.
The NNPC shares ownership of the NLNG with Shell Gas BV, Total Gaz Electriciate Holdings France and Eni International in 49%, 25.6%, 15% and 10.4%, respectively.
The NNPC has also, in response to the Senate’s probe into its rights to make withdrawals from the Dividends Account, stated that it will seek redress from the courts as to its rights in this regard. The NNPC stated that whilst it respects the legislators right to carry out its statutory oversight functions, it relies on the Nigeria Liquefied Natural Gas Act which it believes grants the NNPC the right to defray the costs of its operations from earnings and legitimises the withdrawals from the Dividends Account.
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