Despite Confirming Payment, NNPC Says It’s Not Subsidising Fuel

The Nigerian National Petroleum Company Limited (NNPC Ltd.) said it had not paid any fuel subsidies in the last nine months, refuting claims of subsidising Premium Motor Spirit (PMS) costs.

Speaking at a press briefing in Abuja, the Chief Financial Officer of NNPC Ltd., Alhaji Umar Ajiya, stated that no payments had been made to marketers or other entities under the guise of fuel subsidies.

“In the last eight to nine months, NNPC Ltd. has not paid anybody a dime as a subsidy; no one has been paid Kobo by NNPC Ltd. in the name of subsidy,” Ajiya said.

He explained that NNPC Ltd. has been responsible for the importation of PMS, with the government instructing them to sell at a reduced price, creating a shortfall between the landing cost and the sale price.

However, Ajiya emphasised that this shortfall was a matter to be reconciled between the federation and NNPC Ltd., with no direct payments made to marketers.

He elaborated that NNPC Ltd. maintains credit lines that are typical in downstream business operations.

He added that the company was in an open credit agreement with PMS suppliers in the past, with term-line contracts for payment.

Echoing the same sentiment, Dapi Segun, the Executive Vice President of downstream at NNPC Ltd., said establishing an open credit agreement with suppliers spoke volumes about the credibility the national oil company had built over time.

“Concerning the outstanding amount to the suppliers, it is not in that magnitude that has been put out; it is lower than $6.8 billion.

“What matters is the relationship between us and our suppliers to ensure that we keep faith in making these payments to our suppliers, which we have done over time.

“You would understand that it is not a static figure, and I wouldn’t want to quote any figure. When we make payments, it goes down, and when they supply products, it goes up.

“It is a dynamic way, but the most important thing is to ensure that we continue to make PMS available across the country,” he said.

NAN

Read More:

• Rivers State Shuts Down Two Hospitals For Unlicenced Operations, Unqualified Staffing
• Terrorists Kill Katsina Governor’s aide, wife, One Other, Abduct 29
• Police Raid Abuja Market, Arrest BDC Operators as Naira Declines Against Dollar

About The Author

Oluwasegun Sanusi

author

See author's posts