The Nigerian National Petroleum Company Limited has provided explanations for why an N123 billion interim dividend for the month of June was paid to the Federation Account Allocation Committee.
According to the News Agency of Nigeria, FAAC distributed N907 billion to the three levels of government on Thursday.
NNPCL donated N81 billion as a monthly interim dividend and N42 billion as a 40% oil Production Sharing Contract profit, for a total of N123 billion, from the money split.
In a statement, the NNPCL Chief Financial Officer, Mr. Umar Ajiya, explained that the action was taken to strengthen the company’s position as an income-generating entity after the Petroleum Industry Act 2021.
He added that this will provide the foundation for a profitable future and establish international best practice that will enable NNPCL to compete with Saudi Aramco, China Petroleum & Chemical Corp., Exxon Mobil Corp., and other top oil companies.
“The Group Chief Executive Officer, NNPCL, Malam Mele Kyari, wants to put the country’s oil firm on the path to sustainable growth and profitability.
“Since the NNPC was transformed from a loss-making organization prior to the PIA to a strong profit-making firm following the PIA, the company under Kyari has sought best practices in global governance.”
He added that the payment to FAAC clearly demonstrates that the company, led by Kyari, is moving in a positive direction as enshrined in the PIA.
According to the Director, Press and Public Relations, Office of the Accountant General of the Federation, Mr. Bawa Mokwa, the N907.054 billion shared by FAAC was made up of N273.225 billion in Value Added Tax revenue and N301.501 billion in distributable statutory revenue.
According to Mokwa, the income split included earnings from the Electronic Money Transfer Levy, which totaled N11.436 billion, and the Exchange Difference, which brought in N320.892 billion.
He noted that the balance in the Excess Crude Account was 473,754.57 million dollars and that the total deductions for savings, transfers, and refunds in June were N979.078 billion and N73.235 billion, respectively.
The Accountant General of the Federation, Dr. Oluwatoyin Madein, who served as the meeting’s chair, also said that the Federal Government received N345.564 billion from the total distributable revenue of N907.054 billion.
In a similar vein, local government councils received N218.064 billion, while state governments received N295.948 billion.
The relevant states received a total of N47.478 billion as a 13 percent derivation income share.
The gross statutory income for the month of June 2023 was N1,152.921 billion, which was N451.134 million more than the N701.787 million in revenue for the month of May.
The Federal Government collected N146.710 billion, State Governments N74.413 billion, and Local Government Councils N57.370 billion from the N301.501 billion distributable statutory revenue.
The relevant States received a total of N23.008 billion as a 13% derivation revenue share.
The gross revenue from the Value Added Tax available for the month of June 2023 was N293.411 billion, which was N23.214 billion more than the N270.197 billion available for the month of May 2023.
From the N273.225 billion distributable Value Added Tax revenue, the Federal Government received N40.984 billion, the State Governments N136.613 billion, and the Local Government Councils N95.629 billion.
The Federal Government collected N1.715 billion, the State Governments received N5.718 billion, and the Local Government Councils received N4.003 billion of the N11.436 billion Electronic Money Transfer Levy.
The Federal Government got N156.155 billion from the N320.892 billion Exchange Difference earnings, while the State Governments received N79.204 billion.
The relevant States received a total of N24.470 billion as a portion of the local government councils’ 13% mineral earnings, leaving the local government councils with N61.063 billion.
The communiqué states that the Company’s Income Tax had a significant increase in the month of June 2023.
Petroleum Profit Tax and Electronic Money Transfer Levy declined greatly, whereas Import and Excise Duties, Value Added Tax, and Oil and Gas Royalties all climbed significantly.
