The Nigerian National Petroleum Company Ltd. has lamented as the fuel subsidy hits over N400bn, adding that it is extremely challenging for them to be funding this from the cash flow of the company without getting refunds from Ministry of Finance.
The Group Chief Executive Officer, NNPCL, Mallam Mele Kyari made this known on Friday in Abuja at the ongoing Final Cutover to NNPC Ltd., from being a corporation.
Kyari disclosed that NNPCL was spending about N202 as a subsidy on every litre of petrol consumed across the country.
He stated further that about 65 million litres of PMS were pumped daily into the market by the NNPCL to keep the country wet.
While assuring Nigerians of efficient supply of PMS, Kyari said the oil company would continue to meet its obligations by providing PMS for Nigeria, adding that the over N400 billion monthly subsidy had been a severe strain on NNPCL’s cash flow.
He said, NNPCL has been the sole importer of petrol into Nigeria and it would continued to play that role for several years running, bearing the huge cost of fuel subsidy.
Commenting on private oil marketers, he said other private oil marketers stopped importing petrol into Nigeria due to the difficulty encountered in accessing the United States dollars, required for the imports of PMS.
“Today, by law and the provisions of the Appropriation Act, there is subsidy on the supply of petroleum products, particularly PMS into our country. In current data terms, three days ago the landing cost was around N315/litre.
“Our customers are here, we are transferring to each of them at N113 per litre.
“That means there is a difference of close to N202 for every litre of PMS we import into this country. In computation, N202 multiplied by 66.5 million litres, multiplied by 30 will give you over N400 billion of subsidy every month,” he said.
Despite the fact subsidy has been budgeted for in the Appropriate Act, Kyari said that the continuous funding of petrol subsidy by NNPCL had been ongoing without refunds from the Federal Ministry of Finance, Budget and National Planning.
“There is a budget provision for it. Our country has decided to do this. So, we are happy to deliver this, but it is also a drain on our cash flow, and I must emphasize this.
“For as we continue to support this, you will agree with me that it will be extremely challenging for us to continue to fund this from the cash flow of the company when you do not get refunds from the Ministry of Finance,” he said.
He, however, promised that it would continue to support the country and deliver energy security.