We’ll deduct N242.53bn fuel subsidy from FAAC this month – NNPC

Nigerian National Petroleum Company Limited has resolved  to deduct N242.53bn as subsidy on Premium Motor Spirit, popularly called petrol, from the Federation Account this month.

Although it described the proposed subsidy deduction as a value shortfall, the oil firm stated that the fund would be recovered from February 2022 proceeds due for sharing in the March 2022 Federation Account Allocation Committee meeting.

The NNPC disclosed this in its latest presentation to the FAAC meeting, which was obtained by our correspondent in Abuja on Friday.

It said, “The December 2021 value shortfall recovery on the importation of PMS amounted to N210.38bn.

“The recovery consists of December 2021 value shortfall of N176.48bn plus the outstanding value shortfall recovery of N33.9bn accrued over the 2021 year. The November 2021 spot arrears of N98.81bn is also outstanding.

“The estimated value shortfall of N242.53bn (consisting of N143.72bn for January 2022 recovery plus November spot arrears of N98.81bn) is to be recovered from February 2022 proceed due for sharing at the March 2022 FAAC meeting.”

Recall that in February this year, the NNPC remitted no money to FAAC due to its huge fuel subsidy spending and subsequent deduction from the Federation Account.

On March 3, 2022, state governors lambasted the NNPC for not remitting any funds at last month’s FAAC meeting.

The Chairman of the Nigeria Governors’ Forum and Governor of Ekiti State, Kayode Fayemi, had also wondered how the oil firm was bold enough to declare profit when it had not been meeting its FAAC obligations.

Fayemi had disclosed this alongside other governors during the Nigerian Governors’ Forum session on natural resources at the Nigeria International Energy Summit 2022 in Abuja.

He specifically pointed out that in the last Federation Accounts Allocation Committee meeting in February, the NNPC made zero remittance to the federation.

“We’ve just had the Federation Accounts Allocation Committee meeting a couple of days ago and the NNPC contributed zero to the Federation Accounts this month,” the governor had stated.

Various industry operators told our correspondent that unless the fuel subsidy regime was halted, the deductions might continue, as NNPC had been the sole importer of petrol into Nigeria for more than four years running.