Nigeria’s petrol subsidy payments gulp N2.04trn in seven months

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The Nigerian National Petroleum Company (NNPC) Limited says N448.78 billion was spent on petrol subsidy in July.

The company made the disclosure in its monthly presentation to the federation account allocation committee (FAAC) meeting on August 24th, 2022.

The figures showed that the country has paid N2.04 trillion to offset subsidy payments in the 7-month period — while the payment of N1.04 trillion has been carried forward.

For the seventh month in a row, the company also failed to make remittances into the federation account owing to huge subsidy payments.

It, however, raked in N400.47 billion as gross domestic crude oil and gas revenue — 10.07 percent below petrol subsidy payment in the same month.

The month’s zero remittance came despite the potential to boost revenue with an average oil price of $111/barrel and 1.08 million barrels per day (bpd) oil output.

Over the months, the NNPC has deducted funds meant to be remitted to the federation account (FAAC) to cover for petrol subsidy, resulting in zero revenue remittances.

In January, February and March 2022, petrol subsidy payments gulped N210.38 billion, N219.78 billion, and N245.77 billion. In April, May and June, the country spent N271 billion, N327.07 billion and N319.18 billion, respectively.

“The sum of N400,469,663,160.14 as the gross Domestic Crude Oil and Gas revenue for the month of July 2022,” the report reads.

“The Value Shortfall on the importation of PMS recovered from July 2022 proceeds is N448,782,119,154.91 while the outstanding balance carried forward is N1,044,514,420,619.73.”

Speaking during its transitioning event in July, Mele Kyari, group chief executive officer of NNPCL, said the oil company would continue to charge the federal government a fee to carry out petrol subsidy payments.

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