Figures released by the Nigerian National Petroleum Company (NNPC) Limited on Monday, showed that amount spent as subsidy on Premium Motor Spirit, popularly called fuel, and on refinery rehabilitation between January and May this year was N1.301 trillion.
The company disclosed this in its latest presentation to the Federation Account Allocation Committee meeting for the month of June 2022.
Bulk of the oil firm’s spending was on petrol subsidy, as it consumed N1.274tn during the five-month period, while for refinery rehabilitation, NNPC spent N9.11bn in each of the months of January, March and April, amounting to N27.33bn.
An analysis of NNPC’s monthly fuel subsidy spendings indicated a continuous rise in the amount incurred as subsidy by the Federal Government through NNPC.
Data from the national company showed that N210.38bn, N219.78bn, N245.77bn, N271.59bn and N327.1bn were used in subsidising PMS in January, February, March, April and May 2022 respectively.
NNPC is the sole importer of petrol into Nigeria for several years running. Nigeria’s four refineries are not working, though the Port Harcourt refinery is currently under rehabilitation.
The national oil company refers to its subsidy spendings as under-recovery/value shortfall, and deducts it every month before making any remittance to FAAC, a development that has stopped NNPC from remitting anything to the Federation Account this year.
In its latest presentation to FAAC, the oil firm also informed the committee that it would deduct N845.15bn from what would be shared by the committee next month.
“The value shortfall on the importation of PMS recovered from May 2022 proceeds is N327,065,907,048.06, while the outstanding balance carried forward is N617bn,” NNPC stated.
“The estimated value shortfall of N845,152,863,012.97 (consisting of arrears of N617bn plus estimated May 2022 value shortfall of N227,721,200,478.23) is to be recovered from June 2022 proceed due for sharing at the July 2022 FAAC meeting.”
The amount spent on petrol subsidy monthly has been depleting the revenues accruable to the Federation Account and limiting the funds being shared by the three tiers of government.