The Nigerian National Petroleum Corporation, NNPC paid a whopping sum of N306.92 billion on fuel subsidy in 2015 alone. The subsidy experienced a decrease in the amount transferred to the Federation Account, which dropped to N1.02 trillion, Monthly Financial and Operations Report of the corporation for December 2015 has revealed.

Expectedly, the corporation recorded crude oil losses of N8.399 billion; product losses of N51.314 billion, while the sum of N103.5 billion was spent on pipeline repairs and management costs.

A detailed review of the statement showed that between January and June, the NNPC consequently spent N15.35 billion, N11.175 billion, N31.06 billion, N30.01 billion, N53.05 billion, N18.928 billion on subsidy payments; while N35.95 billion, N35.51 billion, N18.11 billion, N27.66 billion, N16.5 billion and N13.62 billion respectively were paid between July and December of the same year.

The NNPC repaid N75.965 billion from its N450 billion indebtedness to the Federation Account, while it also paid N6.33 billion monthly, from January to December 2015, to the Federation Account.

NNPC made a total payment of N1.095 trillion from its domestic sales proceeds to the Federation Account in the said period. On a month-by-month basis, the NNPC remitted N137.79 billion, N84.5 billion, N103.56 billion, N90.09 billion, N102.99 billion and N101.96 billion for January to June respectively. Within the period of July to December, the NNPC paid N77.4 billion, N76.18 billion, N73.26 billion, N88.48 billion, N66.526 and N92.67 billion to the national treasury.

Although it recorded N987.54 billion as proceeds from domestic sales, it recorded a higher export earning than its domestic sales. $4.74 billion or N948 billion accrued to it from the export of crude oil and gas in the period under review. It utilised $4.13 billion, about N826 billion for its Joint Venture cash call funding, and remitted only $607.827 million, about N121.6 billion to the Federation Account. Out of the export earnings, $3.16 billion came in from the sale of crude oil while $1.296 billion from the gas sales, and $282.773 million from other receipts.

The current total export receipt dropped by more than 50 per cent following the further slide in crude oil prices and additional shut-in of about 35,000 barrels of oil per day (bopd) in Usan and Yoho Terminals. Other factors include none receipt of NLNG Feedstock of about $74.47 million following payment slippage into the new year and 57.08 per cent drop in LPG/NGL lifting.

Total export crude oil and gas receipt for the period of January – December 2015 is $4.74 billion. Of the total receipts, the sum of $0.61billion was remitted to Federation Account while the balance of $4.13 billion was used to fund the JV Cash Call for the period.

Thus JV funding has gulped more than 87 per cent of the proceeds. JV cash call is a first line charge to Federation Account and 2015 approved budget requires monthly funding of about $615.8 million. NNPC is therefore mandated to sweep all the export receipt to JV Cash Call funding implying a zero remittance to Federation Account,” the corporation stated in the report.

Ogie Omelegie
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