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NNPC: The fuel subsidy reaches N1.03tn, the NNPC will deduct N199bn from the federation account

Nigerian National Petroleum Company Limited reduced the amount spent between January and October 2021 to subsidize Premium Motor Spirit, popularly known as gasoline, to N1.03 bill. 

The NNPC also said it made its October 2021 value deficit of N199 billion at the November 2021 FAAC meeting caught up with our correspondent in Abuja on Sunday for the NNPC’s oil and gas sales in September 2021 and revenue in October 2021. 

In the report, the oil company labeled its subsidy spending as insufficient recovery, having repeatedly stated that it did not have National Assembly approval to pay the subsidy. 

For about four years in a row, NNPC has remained the only gasoline importer in Nigeria. Other traders stopped importing the product because they did not have adequate access to the US dollar.

A study from the latest NNPC report showed that while nothing was recorded as insufficient PMS recovery / deficit in January of this year, the oil company recorded N25,374 billion in February, March and April, N60.396 billion in May, In June and July the NNPC saw cuts (gasoline subsidies) / deficits in value of N 126,298 billion, N 164,337 billion and N 103.286 billion, respectively.

N283 billion and N163,709 billion in August, September and October respectively In its November 2021 FAAC records, the national oil company stated that its total crude oil production of 11.49 million barrels (export and domestic crude) in September 2021 was 98.5 percent increase compared to the 5.79 barrels raised in August 2021. 

“Nigeria had a production of 1.417 million in September 2021,” the company stated in its latest report. On the sales receipt, the NNPC stated that there was no crude oil export revenue for the month of September, but stated that domestic and other gas revenue for the month was N6.78bn.

It stated that the domestic gas receipt in the month was N4.07bn, adding that feedstock valued at $59.43m was sold to Nigeria Liquefied Natural Gas company during the period, out of which $52.57m was received during the month.

For other receipts, the oil firm stated that the sum of $95.63m being miscellaneous receipts, gas and ullage fees and interest income were received in October 2021.

“The sum of N252,968,629,898.13 was the gross domestic crude oil and gas revenue for the month of October 2021,” the report stated.

It added, “The recoveries were strategic holding cost and pipeline repairs amounting to N7,757,631,778.84; product losses worth N143,386,571.87 and value short fall of N163,709,314,928.61 (this comprised of the N123,709,314,928.61 for September 2021 and N40,000,000,000 value shortfall deferred in June 2021.

“The October 2021 value shortfall of N199,007,758,422.75 is to be recovered from the November 2021 proceeds due for sharing at the December 2021 FAAC meeting.”

The deductions by the NNPC from its remittances to FAAC had raised diverse concerns lately, particularly among state governors.

The Governor of Kaduna State, Nasir El-Rufai, for instance, recently decried the high cost of fuel subsidy, which according to him, was not reasonable.

Written by T.I Ukende

T.I Ukende is a professional writer and ICT consultant. He has written many evergreen articles for Benuecast blog, classicgist, ellabase and many others before birthing the newsway blog.
Newsway delivers well researched and undiluted information on business, employment opportunities, personal finance and government empowerments.

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