THE Nigerian National Petroleum Company Limited (NNPCLtd) has disclosed it paid a subsidy of N297 per litre on 68 million litres of petrol daily from January to August, 2022.
The company revealed the figures in a statement issued yesterday by its official spokesperson, Garbadeen Muhammad.
Muhammad, giving a breakdown of the figures, stated that the average second quarter international market landing cost of petrol was $1,283 per metric tonne, while the approved marketing and distribution cost was N46 per litre.
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According to him, the combination of several cost elements translated to a retail pump price of N462 per litre and an average subsidy of N297 per litre.
He noted further that the average daily evacuation (depot truck out) from January to August 2022 was 67 million litres per day, as reported by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA).
The company explained that rising crude prices and petrol supply cost above the NMDPRA cap had forced oil marketing companies to withdraw from oil import since the fourth quarter of 2007.
Both the World Bank and International Monetary Fund had questioned Nigeria’s wisdom in continuing huge payments for subsidy on petrol imports to the detriment of infrastructural development.
Nigeria spends N18.397 billion per day on subsidy payment daily, according to Minister of Finance, Zainab Ahmed, an amount that would construct 74 kilometres of road, going by a 2019 World Bank report that put the cost of constructing a kilometre of road at ₦238 million.
Already, the government has projected it would be spending the sum of N6.715 trillion from January to December next year if it has to retain subsidy on importing N64.96 million litres of petrol per day.
Subsidy payment has starved Nigeria of funds to the Federation Accounts Allocation Committee (FAAC), which disburses monthly handouts to all the tiers of government.
There have always been talks around the actual volume of petrol that the country consumes daily as some industry watchers argue Nigeria could just be paying subsidy for its West African neighbours.
The Comptroller-General of the Nigeria Customs Service (NCS), Hameed Ali, only last week questioned the daily consumption figure given by the NNPCLtd, describing it as “a fraud.”
Ali, during his presentation at the National Assembly on the 2023 budget draft on September 1, queried what he observed as the discrepancy between the average figure of 98 million litres of petrol per day that the NNPCLtd said was being lifted at the depots and its given daily consumption figure of 60 million litres per day.
“If NNPC Limited claims that it lifts 98 million litres of fuel every day and only 60 million (which is even questionable) is consumed by Nigerians daily, what then happens to the remaining 38 million litres?” the NCS chief wondered.
Harrison Edeh is a journalist with the International Centre for Investigative Reporting, always determined to drive advocacy for good governance through holding public officials and businesses accountable.