• Govt to issue licences to importers

From Juliana Taiwo-Obalonye, Abuja

Group Chief Executive Officer (GCEO) of Nigerian National Petroleum Company Limited (NNPCL), Mele Kyari, has disclosed the Federal Government is owing the company N2.8 trillion of cash flow from the subsidy regime.

Speaking to State House Correspondents after meeting with President Bola Tinubu, Kyari while stressing that the reality is that the federation can no longer pay NNPC for the burden of subsidy that it’s  carrying, it intends to recover from the market.

He said: “Our position is we are a supplier of last resort to the federation, we are a commercial company, supplying to the federation during the subsidy regime. Now I’m also aware that government will act to bring succour and relief to our country people. I know this government is very sensitive and they will do this.

“So, there are engagements that are ongoing to bring into effect that component of it. So, NNPC will not do anything because we are a commercial company. It will not come from NNPC. But I’m aware government will do something around this. But the reality is that you cannot give what you don’t have. So, as at today, the country don’t have the money to pay for subsidy.

“There’s incremental value that will come from it. But it is not an issue of whether you can do it or not because today, we can afford it and they are not able to pay our bill. That comes to how much is the federation owing NNPC now? Today, we are waiting for them to settle up to N2.8 trillion of NNPC cash flow from the subsidy regime. And we cannot continue to do this.”

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On clarification on when subsidy removal takes effect, Kyari explained: “First of all, the Petroleum Industry Act (PIA) said six months after the enactment of the PIA, petroleum motor spirit (PMS) will be priced at its commercial value. So, there will be no subsidies six months after the enactment on the PIA. That means by February 17, 2022, there should have been no subsidy on PMS.

“Now the National Assembly and government, in their wisdom, provided for soft city in 2022, despite the fact that the provision of the PIA said terminated by February 17.

“So, government can decide to spend its money anywhere it wants and it can bring succour and relief to its citizen. This is very typical. It happens all over the world. But however, that provision in 2022 and also 2023 has not been funded by government.

“A greater part of it is supported by the cash flow from NNPC’s other businesses. And therefore, even though there is provision to the end of June, there is no financing even from the start. And therefore since you can’t pay, you cannot expect NNPC to continue to carry it. And this has been the position that the NNPC has taken and what the president simply say is obeying the law and also the reality that the federation can no longer pay NNPC for the burden of subsidy that we are carrying.”

PMS of Nigerian Midstream and Downstream Petroleum Regulatory Authority, Farouk Ahmed, on his part, said in other to ease the burden on NNPCL being the sole importer of PMS, it’s ready to issue licenses to interested persons.

He said the criteria for importing fuel will be the same as those importing kerosene and diesel.

“There are a lot of conditions to be met before you are given licence to import patrol. I cannot give you all of them now. But they are the same conditions to import kerosene and diesel, the same condition you will meet to import PMS.”