Govt owes NNPC N2.8trn in subsidy payments says Kyari –

A day after the implementation of the brand new petrol worth regime for the post-subsidy removing period, it has emerged that the federal government owes the Nigerian Nationwide Petroleum Co. greater than $6 billion that the agency has spent to maintain gasoline low-cost.

The state-owned oil firm shouldn’t maintain absorbing the burden of preserving one of many lowest costs of the gasoline on the earth, Chief Govt Officer Mele Kyari advised reporters within the capital, Abuja, on Tuesday, welcoming President Bola Tinubu’s resolution to cease the funds that value greater than $10 billion final 12 months.

Based on Bloomberg, the NNPC is ready for the federal government to pay a 2.8 trillion naira ($6.1 billion) debt, Kyari mentioned. “We are able to’t proceed to construct this,” he mentioned.

Following Tinubu’s first handle to Nigerians after taking the oath of workplace on Monday, queues shaped exterior petrol stations, which have already began elevating their costs.

This was adopted Wednesday morning by the adjustment of petrol worth at NNPC stations in Lagos to N488 a litre, Abuja N537 a litre and Port Harcourt N511 per litre.

Phasing out the subsidies may considerably enhance transport prices and will set off social unrest because it did throughout a earlier effort to take away the funds in 2012.

Though Nigeria is Africa’s largest oil producer, the NNPC purchases all of the nation’s gasoline from abroad through crude-for-fuel swaps with native and worldwide merchants earlier than promoting the imported merchandise at a loss to wholesalers and retailers.

The Tinubu administration plans to license different gasoline importers, in accordance with Farouk Ahmed, chief govt of the Nigerian Midstream and Downstream Petroleum Regulatory Authority. This may introduce competitors into the business, he mentioned alongside Kyari on the presidency.

Whereas the earlier authorities underneath President Muhammadu Buhari was alleged to fund the subsidies for the final 18 months, many of the value has been “supported by the money move from NNPC’s different companies,” Kyari mentioned. “Since you can not pay, you can not anticipate NNPC to proceed to hold it.”