Page last updated at 15:48 GMT, Tuesday, 22 April 2008 16:48 UK

Nigerian oil sector being probed

Olusegun Obasanjo
The former president Olusegun Obasanjo was also the minister in charge of petroleum

Members of Nigeria's parliament have launched an investigation into the country's oil and gas business.

The probe aims to shed light on the impenetrable corruption that dogs the industry in the country.

It follows a similar probe into the power sector which revealed corrupt deals that have left Nigeria without reliable electricity supply.

Nigeria is currently the eighth biggest exporter of oil in the world, but most of its population remain poor.

"Can of worms"

The House of Representatives have begun the investigation into the Nigeria National Petroleum Corporation (NNPC) and the Department of Petroleum Resources (DPR) during the administration of former president Olusegun Obasanjo.

They oversee both the licensing of oil companies pumping crude and gas from underground and the importation of refined petrol into the country.

The investigation will "open a giant can of worms", Shehu Matazu a member of the House of Representatives said.

"By the time this is over, the worms will crawling all over this chamber."

The 26-man committee has two months to get to the bottom of how much oil and gas the NNPC is allocated, and where the money goes.

House speaker Dimeji Bankole warned members not to turn the probe into a "witch hunt" of political enemies.

"Do you really have any idea what you are about to start?" he said.

Many of Nigeria's leading elite are involved in the oil and gas business, if found to be implicated in corruption they may face criminal charges, the committee said.

President Obasanjo was also oil minister for the eight years of his administration.

"You can't make an omelette without breaking eggs," investigation co-chairman Tam Brisbe told the BBC.

Shady deals

A source in an African oil company, who did not wish to be identified, said the probe would catch a lot of people out.

"There has been a lot of shady deals over the allocation of oil blocks," he said.

The Nigerian consumer has also been the victim of shady deals that needed to be exposed, a petrol industry association said.

"There was a lot of foul play under the last administration," says Danladi Pasali, spokesman for the Independent Petroleum Marketers Association.

At the beginning of President Umaru Yar'Adua's administration he announced there would be sweeping reforms in the oil sector following an audit of the NNPC which revealed questionable practices in the parastatal.

This latest investigation comes after a high profile probe into the power sector revealed the government of President Obasanjo paid $50m (25m) to non-existent companies involved in generating electricity.

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