The Nigerian National Petroleum Corporation, NNPC, has disclosed that subsidy payments for the months of January and February 2022 cost the Nigerian Federation a whopping N430.165bn.
In its presentation to the Federation Account Allocation Committee (FAAC) meeting for March 2022, the NNPC revealed that N328bn will be deducted, as under-recovery of PMS, from what would be shared by FAAC in April 2022.
With less money available for sharing, Nigeria’s sub-national entities or federating states are likely to face steeper financial challenges.
The NNPC stated that in January this year the sum of N210.38bn was used to subsidise petrol, while N219.78bn was spent as subsidy in February.
The NNPC is the sole importer of petrol into Nigeria. With official pump price of petrol pegged at between N162 and N165/litre, the higher cost of imports – estimated at about N500/litre – is absorbed by government as subsidy.
In its presentation, the NNPC informed the FAAC meeting that: “The estimated value shortfall of N328,004,248,900.01 (consisting of N253,004,248,900.01 for February 2022 recovery plus the balance of November 2021 spot cargo arrears of N75,000,000,000.00) is to be recovered from March 2022 proceed due for sharing at the April 2022 FAAC meeting.”
In its notes to the March 2022 FAAC executive summary, the NNPC stated that the overall NNPC crude oil lifting of 9.94 million barrels (export and domestic crude) in January 2022 recorded 22.26 per cent increase relative to the 8.13 million barrels lifted in December 2021.
It said Nigeria recorded 1.39 million barrels per day production in January 2022, citing OPEC, the Organization of Petroleum Exporting Countries, data.
NNPC stated that crude oil export revenue received in February 2022 amounted to $2.73m, while domestic gas receipts in the month was N13.10bn.