• Tuesday, July 23, 2024
businessday logo

BusinessDay

NNPC invites forensic audit of petrol supply, subsidy

NNPC

The Nigerian National Petroleum Company Limited (NNPC) has offered to submit itself for forensic audit of fuel supply and subsidy management.

The NNPC said on Sunday that the daily average supply of premium motor spirit (PMS), also known as petrol, was 68 million litres between January and August 2022.

In a statement by Garba Deen Muhammad, group general manager, group public affairs division, the NNPC said the total volume of petrol imported into the country in the period was 16.46 billion litres, translating to an average supply of 68 million litres per day.

The company said it imported 22.35 billion litres in 2021, which translates to an average supply of 61 million litres per day.

It said: “Rising crude oil prices and petrol supply costs above Petroleum Products Pricing Regulatory Agency (now NMDPRA) cap had forced Oil Marketing Companies’ withdrawal from petrol import since the fourth quarter of 2017.
Read also: NNPC says it pays N297 per litre to subsidize imported petrol

“In light of these challenges, NNPC has remained the supplier of last resort and continues to transparently report the monthly petrol cost under-recoveries to the relevant authorities.”

The NNPC said that the average international market-determined landing cost in the second quarter of this year was $1,283 per metric tonne and the approved marketing and distribution cost was N46/litre.

It said the combination of these cost elements translated to a retail pump price of N462/litre and an average subsidy of N297/litre.

It also translates to an annual estimate of N46.5 trillion on the assumption of 60 million litres of daily PMS supply, according to the statement.

It said this would continuously be adjusted by market and demand realities.

“NNPC shall continue to ensure compliance with an existing governance framework that requires the participation of relevant government agencies in all PMS discharge operations,” the statement said. “This includes Nigerian Ports Authority, Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), Nigerian Navy, Nigeria Customs Service, NIMASA and all others.”

The NNPC said it recognised the impact of maritime and cross-border smuggling of petrol on the overall supply framework.

It said: “Furthermore, NNPC acknowledges the possibilities of other criminal activities in the petrol supply and distribution value chain. As a responsible business entity, NNPC will continue to engage and work with relevant agencies of the Government to curtail the smuggling of petrol and contain any other criminal activities.

“We will continue to deliver on our mandate to ensure energy security for our country with integrity and transparency. We invite any forensic audit of the petrol supply and subsidy management framework of the NNPC.”