NNPC Retaining The $10.8bn Will Lead To Price Shocks. Sanusi Lamido Insists

Governor of the Central Bank of Nigeria (CBN) Sanusi Lamido Sanusi has insisted that the Nigerian National Petroleum Corporation (NNPC) lacked the power to retain $10.8 billion from the federation account. He asserted that the corporation’s action had contributed to a drop insavings which had exposed Nigeria to possible price shocks....If you mean food stuff,it is already happening.In Nigeria the poor has no hope of getting rich are making sure they never wear the shoes of the poor man,if food prices will go up as you predict,can you prefer a solution?

In an interview with Bloomberg on Wednesday, Sanusi argued that given current oil price, Nigeria should have more in terms of reserves and savings, “and because we don’t have that we are susceptible to shocks in the event of a decline in the oil price”.

A letter Sanusi wrote to President Goodluck Jonathan alleging that the NNPC had withheld $49.8 billion in revenue sparked a public outcry when it was leaked to the media last month. Finance minister Ngozi Okonjo-Iweala told reporters on December 18 that a reconciliation of the accounts showed that unaccounted oil receipts stood at $10.8 billion.

But Sanusi in the interview insisted: “No one has the right to retain money that should have gone to the federation account, so the fact that you’ve admitted retaining or withholding $10 billion is itself bad enough. This money was supposed to come in and, if it came in, it would be part of our reserves and part of our excess crude savings.”

On January 10, Bernard Otti, the NNPC’s group executive director of finance and accounts, told journalists that the $10.8 billion was spent on pipeline repairs, fuel subsidies and reserve fuel.....if i hear!

Sanusi, who is not seeking a second term as CBN governor when it expires in June, said there was no request from President Goodluck Jonathan that he should resign and “it’s back to business as usual”.

Lower savings are “not explained by a huge increase in government spending, because there wasn’t between 2013 and 2012,” Sanusi said, adding: “So if spending didn’t increase much and if the oil price didn’t crash much and exports didn’t crash much, there’s a leakage.”

According to him, a decline in oil production doesn’t explain the drawdown in savings either because the crude price has exceeded the government’s budgeted price. The spot price of Nigeria’s benchmark Qua Iboe crude has exceeded $100 a barrel for most of 2013, above the $79 budgeted price that year.

“This whole process for me is one in which we need to force greater transparency over oil revenues,” Sanusi said. The NNPC has “now given explanations and they’re going to be called to show evidence”.culled

Sanusi said his letter to Jonathan was never meant to be made public....who leaked it then??

“What was in fact an invitation to investigate somehow became read as the end of an investigation, the conclusion from an investigation and that wasn’t it,” he said. “This was an initial report given that, for me, raises sufficient concern to ask the president to have an investigation so we can know exactly where the money is.”culled