The Office of the Auditor-General for the Federation has uncovered extensive financial irregularities linked to the Nigerian National Petroleum Company Limited, amounting to an estimated N61.1bn when converted from multiple foreign currencies.

According to the 2022 Annual Report on Non-Compliance (Volume II), the red flags relate to transactions executed during the 2021 financial year across NNPC Ltd and several subsidiaries.

The report, already transmitted to the National Assembly, cited weak internal controls, undocumented payments, tax infractions, irregular procurements, abandoned projects, unauthorised virements, and other financial discrepancies.

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“These findings expose systemic weaknesses that continue to put public funds at risk. Payments without documentation cannot be justified, and expenditures without approvals violate existing financial laws,” the Auditor-General’s office said.

The revelations follow earlier audit reports from 2017 to 2021, which highlighted diversion and unremitted funds totaling over N2.68tn and $19.77m within four years — a pattern that continues to raise concerns about transparency and corporate governance in Nigeria’s petroleum sector.

£14.3m Spent by NNPC London Office Without Documentation

One of the most notable issues in the latest audit—Issue 2—involves the expenditure of £14,322,426.59 at NNPC’s London Office.
Auditors reported that no supporting documents, utilisation records, or verification schedules were provided to justify the spending.

The report notes that this violates key provisions of the Financial Regulations (2009), which mandate full documentation, proper approval processes, and adequate internal controls for all government-related expenditures.

A breakdown of the spending shows:

• £5,943,124.74 – Personnel costs
• £1,436,177.11 – Fixed contracts and essential expenses
• £6,943,124.74 – Other operational expenses

The audit team stated that it was unable to verify whether the expenditure complied with due process.

NNPC Ltd responded that the London Office operates under an approved annual budget and maintains detailed records internally. It added that the audit query did not specify particular line items being questioned.

However, the Auditor-General rejected the explanation, insisting the query stands until the full documentation is provided. The report recommended that the Group Chief Executive Officer of NNPC Ltd appear before the Public Accounts Committees of the National Assembly to account for the funds or remit the entire sum to the Treasury.

More Foreign Currency Irregularities

Other flagged issues include:

• €5,165,426.26 paid to a contractor without evidence of engagement (Issue 12).
• $22,842,938.28 in unsubstantiated Direct Sales Direct Payment settlements (Issue 4).
• $12,444,313.22 from delayed generator procurement for the Mosimi depot (Issue 24).
• $1,801,500 paid under an irregular contract extension for a bunkering vessel (Issue 7).
• $2,006,293.20 paid without invoices (Issue 10).
• $1,035,132.81 paid to a firm lacking power of attorney (Issue 13).

In total, $51.67m in foreign-denominated transactions was flagged.

Naira-Denominated Breaches Total Over N30bn

Domestic infractions include:

• N12.721bn not remitted to the General Reserve Fund (Issue 21).
• N3.445bn authorised by the CFO without the GMD’s approval (Issue 6).
• N2.379bn paid as status-car cash options without proper approvals (Issue 5).
• N1.212bn paid to contractors without interim certificates or invoices (Issue 26).
• N474.46m spent through unauthorised virement (Issue 9).
• N355.43m on demurrage and brokerage for abandoned refinery cargoes (Issue 8).
• N292.6m for an abandoned Accident and Emergency hospital project (Issue 1).
• N152m in irregular procurement for the Nigeria Police Force.
• N145.9m in serial consultancy renewals.
• N25m paid as additional consultancy fees without evidence of new deliverables.
• N246.19m paid for a contract with no proof of execution (Issue 18).
• N46.2m in under-deducted, unremitted withholding tax (Issue 19).
• N6.246bn paid without supporting documents across MDAs, with NNPC accounting for the largest portion (Issue 27).
• N1.365bn processed through unauthorised virements.

Procurement Breaches and Contract Irregularities

Auditors flagged major procurement violations:

Irregular Vessel Substitution (Issue 14)

A vessel originally contracted—MT Breeze Stavanger—was replaced unilaterally by the contractor with MT Alizea at a higher cost, resulting in:

• $2,111.23 excess daily charges
• $770,598.95 variance for 12 months
• $1.926m total excess for 30 months

The audit said NNPC Ltd was exposed to unnecessary financial risk due to weak internal controls.

Other Procurements

• $8.238m “emergency procurement” of custody transfer meters without justification (Issue 11).
• $156,000 paid to a consultant without evidence of engagement (Issue 15).
• Regular renewal of consultancy contracts instead of competitive bidding (Issue 25).
• Payment of a “legacy debt” to the wrong company (Issue 13).

The Auditor-General recommended recovery of unsupported payments, remittance of withheld statutory surpluses, and sanctions for officers responsible.

The report comes as NNPC Ltd continues its transition into a fully commercial entity under the Petroleum Industry Act—highlighting how far it still needs to go in governance and accountability.

Civil society organisations, including CACOL and CISLAC, criticised the persistent opacity within the national oil company and urged stronger government action.