The Nigerian National Petroleum Corporation (NNPC) has announced that it will remit nothing to the federation account in the month of May due huge petrol subsidy payment.
The corporation, which stated this in a document entitled ‘January to March actual and April to June projected remittance to federation account’ stated that making any remittance in May would be impossible after paying April and May fuel subsidy from its revenue.
The document, which was attached to a letter written to the accountant general of the federation, was dated April 26 and signed by the corporation’s chief financial officer, Mr. Umar Isa.
In the letter, copies of which were sent to the minister of finance, budget, and national planning, the director-general of the Nigeria Governors’ Forum, the director, home finance and the chairman, commissioners of finance forum, the corporation explained how fuel subsidy had affected its remittance to FAAC.
It said it would only be able to remit N12.966 billion to the federation accounts allocation committee in June after removing fuel subsidy from its income.
“The accountant-general of the federation is kindly invited to note that the average landing cost of premium motor spirit for the month of March 2021 was N184 per litre as against the subsisting ex-coastal price of N128 per litre, which has remained constant notwithstanding the changes in the macroeconomic variables affecting petroleum products pricing.
“As the discussions between government and the labour are yet to be concluded, NNPC recorded a value short fall of N111, 966, 456, 903.74 in February 2021 as a result of the difference highlighted above. Accordingly, a projection of remittance to the Federation for the next three months is presented in the attached schedule.
“Accordingly, the AGF is invited to note that the sum of N111, 966, 456, 903.74 will be deducted from April 2021 oil and gas proceeds due to the federation in May 2021, which will translate to zero remittance to the federation account from NNPC in the month of May 2021.
“This is to ensure the continuous supply of petroleum products to the nation and guarantee energy security,” said the corporation.
Also, the document shows how the landing cost of the product was between N169.34 and N199.90 with an estimated volume sale of 1, 992, 550, 975.