Business

March 4, 2022

Zero remittance: Govs question NNPC profitability status

NNPC deductions from Federation Account rise 40.5% to N883.56bn in Q1’22

By Obas Esiedesa

Abuja—Following the failure of the NNPC Limited to remit any revenue to the Federation Account Allocation Committee, FAAC, meeting for February, the Nigerian Governors Forum has questioned the corporation’s profitability status.

NNPC had last declared a trading profit of N250 billion.

But speaking at the Governors panel at the Nigeria International Energy Summit, the Chairman of Nigeria Governors Forum and Governor of Ekiti State, Dr. Kayode Fayemi said despite rising crude oil price at the international market, the states were getting nothing from Nigeria’s oil export.

READ ALSO:NNPC being transformed to be 5th gas producing coy globally – Kyari

Rising cost of subsidy, oil theft and operational cost spike have wiped out any benefit from high price of  crude oil.

Fayemi said it was time to rethink how the industry is managed to make it more transparent and accountable to Nigerians.

He said: “We’ve just had FAAC meeting a couple of days ago, and the NNPC contributed zero to the Federation Account this month and this is not the first month that the NNPC is contributing zero. Over the last couple of months, we’ve been having these challenges of course, we know why. 

“Even though oil price in the international market is going up, maybe $110 today or more, the more it goes up it, would appear that the more we suffer locally now. So, there’s an ambiguous relationship of sort between what is happening in the international market and what we’re experiencing here in Nigeria and as critical stakeholders in the Nigerian Federation, states are naturally concerned about this, they are concerned about how to grow this industry and ensure that this industry is sustained over the long term in a manner that it can benefit those who are stakeholders in the industry.

“That is partly why for us governments of the sector is a very, very critical thing to do. The PIA is responding to some of the issues that we have about that, but it’s like a typical transition.”

On his part,  Charmin of Progressive Governors Forum and Governor of Kebbi State, Abubakar Bagudu said the state was ready to collaborate with the NNPC to produce ethanol needed to boost energy supply in the country.

In his closing remarks, the Minister of State Petroleum Resources, Chief Timipre Sylva said the production and utilisation of Nigeria’s natural gas would boost economic growth and create jobs and wealth for the people.

Calling for the support and collaboration of industry players and Nigerians, he said the country has the resources to make huge strides.

He said Nigeria and other African countries need to come up with African energy transition programme and timelines that take into cognizance the development needs of the continent.