NNPC moves to stop remittances to federation account again
…As Tinubu approves use of 2023 dividend for payment of subsidy
Maureen Aguta
Despite reported increase in Nigeria’s production to over 1.6 million barrels per day indications were that the worst that happened during the Buhari regime when the Nigerian National Petroleum Company Limited (NNPCL) for several months made zero remittances to the federation account (which means that Nigeria did not earn anything from its God give crude oil during the period, unfortunately under this same GMD, Mele Kyari), is about to repeat as NNPC has disclosed that will no longer remit anything to the federation because it is paying subsidy.
This is coming as President Bola Tinubu has approved a request by the Nigerian National Petroleum Company (NNPC) Ltd to utilise the 2023 final dividends due to the federation to pay for petrol subsidy.
It was disclosed that the president also approved the suspension of the payment of 2024 interim dividends to the federation in order to augment NNPC’s cash flow.
In addition, the national oil company told the president it will be unable to remit taxes and royalties to the federation account for now because of the subsidy payments, which it termed “subsidy shortfall/FX differential”.
An NNPC forecast seen by the The Cable showed that the cumulative petrol subsidy bill from August 2023 will hit N6.884 trillion by December 2024 — leaving the national oil company unable to remit N3.987 trillion in taxes and royalties to the federation account.
After the ‘subsidy is gone’ by the president on Inauguration on May 29, 2023; the president had refused to admit publicly that it has secretly started paying the subsidy; even though that has failed to bring succor to Nigerian who have to suffer the spiking of the petrol price made worse by the floating of the naira exchange rate.
NNPC is expected to pause the payment of interim dividends for eight months this year — from May to December.