The Nigerian National Petroleum Company Limited has alleged to deduct N242.53bn as subsidy on the Premium Motor Spirit (PMS), popularly regarded to as Petrol, from the Federation account this month.
The NNPC disclosed this in its latest presentation to the FAAC meeting on Friday, at the country’s capital, Abuja, where it said, “The December 2021 value shortfall recovery on the importation of PMS amounted to N210.38bn.”
It went further to include that “the recovery consists of December 2021 value shortfall of N176.48bn, in addition to the outstanding value shortfall recovery of N33.9bn accrued over the 2021 year. And, the N98.81bn outstanding arrears spotted in November, 2021.”
Hence, the NNPC stated that “the estimated value shortfall of N242.53bn consists of the N143.72bn for January 2022 recovery plus the November arrears of N98.81bn is to be recovered from February 2022 proceed due for sharing at the March 2022 FAAC meeting.”
By March 3, 2022, the State governors scolded the NNPC for not remitting any funds at the FAAC meeting in February. Recall that in February 2022, the oil firm remitted no money to the FAAC due to its huge fuel subsidy expense and the continuous deductions from the Federation Account.
The Chairman of the Nigeria Governors’ Forum and Governor of Ekiti State, Kayode Fayemi, demonstrated his surprise at the Nigerian Governors’ Forum session on natural resources at the Nigeria International Energy Summit in Abuja, as the NNPC declared profit, while failing in its obligations with FAAC. Stating that, “the NNPC made zero remittance to the federation account.”
NNPC being the sole importer of petrol into Nigeria for more than four years now has had to bear the shouldering cost of subsidy on the product, as the product’s actual cost is far higher than the approved fuel pump price of between N162 to N165 per litre.
The President of the Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN), Billy Gillis-Harry, mentioned that if not for the subsidy, the price of the PMS would be nearing that of the diesel, selling around N550 to N600 per litre.
The PETROAN President further stated that the N3trillion projected as subsidy expense in the 2022 budget might double before the end of the year if the crude oil price continues to rise.
However, the NNPC’s presentation to the FAAC showed that the overall lifting of the crude oil barrels both domestic and export declined in December 2021 recording about 8.13 million barrels as compared to the previous month (November, 2021) where it recorded 3.81 million barrels. The oil firm added that the crude oil export revenue received in January 2022 amounted to $2.23m and the sum of the gross domestic crude oil and gas revenue for the month of January 2022 totaled N253.36bn.