OIL POLITICS: Drilling in the dark

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5 May 2011

OIL POLITICS: Drilling in the dark

By Nnimmo Bassey

The Nigerian oil sector must be one of the sectors that tolerates blatant disregard for transparency in the land. Being a mono-product economy and depending so much on foreign expertise, technology and dictates opens the sector to peculiar challenges than should be the case.

A reading of the 2005 Nigerian Extractive Industries Transparency Initiative's (NEITI) audit report reveals three interesting things. One of them is that the Niger Delta Development Commission (NNDC) claimed to have received more money than it was given. There must be more miracles lurking in the accounting books of the NNDC. Remember that in their 2010 budget, they had a chicken-change sum of N90m for staff marriages and bereavements! The commission defended the outrageous budgetary allocation on the grounds that it was dictated by emotional intelligence. Peculiar intelligence, one would say.

The second interesting matter that emerged from the NEITI audit was that the Nigerian National Petroleum Corporation still relies largely on paper-based accounting systems. This could be a possible reason why we keep receiving conflicting signals as to whether the corporation is solvent or insolvent.