According to data provided on Monday, June 27, by the Nigerian National Petroleum Company Limited (NNPC), N1.301 trillion was spent between January and May of this year as a subsidy on Premium Motor Spirit, PMS, or gasoline, and on the restoration of refineries.
In its most recent presentation to the Federation Account Allocation Committee meeting for the month of June 2022, NNPC made this disclosure.
The oil company spent the majority of its money on gasoline subsidies, spending N1.274 trillion over the course of five months, while the NNPC spent N9.11 trillion, or N27.33 billion, on the refurbishment of its refineries.
An examination of NNPC’s monthly fuel subsidy expenditures revealed a consistent increase in the amount the Federal Government, acting through NNPC, paid out in subsidies.
According to data from the national corporation, PMS was subsidized with N210.38 billion, N219.78 billion, N245.77 billion, N271.59 billion, and N327.1 billion in January, February, March, April, and May 2022, respectively.
Since a number of years, only NNPC has imported gasoline into Nigeria. The Port Harcourt refinery is now undergoing repair, however none of Nigeria’s four refineries are operational.
The national oil company, also known as NNPC, refers to its subsidy expenditures as under-recovery/value shortfall, and deducts it each month before making any remittance to FAAC. As a result, NNPC has been unable to make any payments 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.
It added, “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.