The Federal Government has paid about N400 billion subsidy debts to major fuel marketers just as the Nigerian National Petroleum Corporation’s (NNPC) spending on subsidy to import Premium Motor Spirit (PMS), also known as petrol, hits N1.06 billion in one day.
Executive Secretary, Major Oil Marketers Association of Nigeria (MOMAN), Clement Isong, who announced the subsidy payment to New Telegraph yesterday, maintained that the imbursement, which is half of the N800 billion subsidy debts, was made to members of his group through promissory notes.
He said: “About 400 billion subsidy has been approved and paid through promissory notes. This divides the debts into half.
“We still have challenges. We owe banks, the government owes us. But, we feel that there is light at the end of the tunnel. What happens is that when the money is paid, we pay the bank, but as a business, we need to have margins. I am chasing margins now because a business that has no margin is not a business.”
Everyone, according to him, knows that it doesn’t make sense for private business concerns to “import petrol into Nigeria. This, I believe, is what has made the NNPC to be the sole importer of the product.”
Meanwhile, the NNPC, which is now the sole importer of petrol incurred N1.06 billion, spending on subsidy in one day.
The Petroleum Products Pricing Regulatory Agency (PPPRA), which announced this in its latest report, noted that the corporation currently subsidised the cost of petrol by N19.37 per litre.
The report published on Tuesday also shows that Nigeria’s current daily consumption of petrol is valued at 55.8 million litres, while NNPC spends an average of N1.06 billion on every litre of petrol consumed in the country daily.
The landing cost of petrol for November 18 was, according to the PPPRA, N144.7 per litre, while the distribution margin was put at N19.37 per litre.
“The total cost of petrol, adding the landing cost together with the distribution cost is N164.07 per litre, but the NNPC takes the distribution costs off the private marketers as subsidy,” data from the report showed.
Petrol is sold at a modulated price of N145 per litre at filling stations across the country.
The Senate, it would be recalled had, in May, approved N129 billion as payment to cover debts to marketers in the last fuel subsidy regime.
For over two years, the NNPC has imported close to 90 per cent of the nation’s petrol because the difference between the price cap and international fuel costs made it expensive for private marketers to import the product.
In another development, the Group Managing Director of the NNPC, Mele Kyari, at the 37th National Association of Petroleum Explorationists (NAPE) Conference & Exhibition in Lagos announced there would be a licensing round for ultra-deep water assets next year.
“As we are all aware, the ultra-deep water is completely unexplored today. Before the end of this year or next year, God willing, I believe there will be some form of bid rounds in that space,” he said.
Kyari said the nation’s crude oil reserves had fluctuated around 37 billion barrels in recent years due to stalled exploration, saying that there might be “a massive depletion in the available resources.”
He added that the amendment of the Deep Offshore Act was a requirement of law, saying the conditions required to make changes were met since 2003.
Kyari also stated that the corporation was poised to automate its downstream facilities such as depots, pump stations and measurement systems across the country.
He stated this during a tour of the state-of-the-art products loading facility and lubricants manufacturing plant of MRS Oil Nigeria Plc., an indigenous oil company based in Lagos.
SOURCE: newtelegraphng.com