17 May 2018

Nigeria: Governors Accuse NNPC of Inflating Fuel Subsidy Figures, Demand Probe From 2015

Photo: Vanguard

State governors have alleged an inflation by almost 50 per cent in the Nigeria National Petroleum Corporation (NNPC) figures on petrol consumption and demanded a probe of oil subsidy payments from 2015 till date.

After a meeting with the Vice-President, Yemi Osinbajo, on Wednesday night, the governors told State house correspondents that the NNPC has almost doubled the figure of daily consumption of petrol from 33 or 35 million litres to 60 million litres.

"On the issue of cost recovery otherwise called subsidy, the issue of subsidy resurfaced again after the efforts of Mr. President. Before now the oil was $40 per barrel and now it is about $78 a barrel, so therefore they are depending largely on importation," the Chairman of the Nigeria Governors Forum and Governor of Zamfara State, Abdulaziz Yari, said.

"Therefore, the cost is higher than what they are selling at the filling station and they need more money. When there was no cost recovery, the NNPC clearly gave us the number of 33 and 35 million liters per day as the consumption of Nigeria.

"But now that with the new regime of cost recovery, NNPC is claiming daily consumption of 60 and 65 million liters per day? Which we rejected and said no.

"So many of our international partners are saying that even if we are feeding Nigeria, Cameroon, Ghana and Niger, we cannot consume more than 35 million liters per day. So we are wondering where the 60 million liters is coming from. We are trying to sort that one out, that one is not yet resolved.

"At the same time, NNPC is making payment on behalf of Nigeria on Cash-call contribution and also the NNPC is making payment of cash call arrears of Nigeria's contribution. Our main concern is that in 2015, they said about $16.8 billion which is outstanding was not paid by the last administration and they negotiated it down to $5.1 billion according to them.

"What we said specifically is that they should bring to us how much they have paid from 2015 to date and what is outstanding. And we directed they stop payment until the claims are proven and then we can give further directives," Mr Yari, said

Speaking as chairman of the Governors forum, Mr Yari also informed correspondent that since the NNPC indicated "porous borders" as the reason for the increase in petrol consumption, they have also directed all petrol stations less than 10 kilometres to the nation's borders be immediately shut by the Department of Petroleum Resources (DPR) until they are recertified.

"We are now taking a very hard decision, that because NNPC said the reason why they were lifting 60 million per day is because our borders are porous, so we have taken the decision that any filling station that is 10 kilometers on the border side should be closed by DPR. And, then we will do recertification according to the needs," he said.

The chairman also said the governors directed the Minister of Finance to collaborate with the DPR and the NNPC to put tracking devices on every truck in order to monitor fuel discharge.

"Because, we are suspicious of the number, we cannot confirm the difference from 30 million liters per day consumption to 60 and 65 million liter per day consumption. So these are our decisions on the NNPC," he said.

The governors also demanded that the NNPC must henceforth clearly differentiate its earnings in sales as against taxes before remitting funds to the Federation Account to avoid unexplained shortfalls.

Other governors at the closed-door meeting were Udom Emmanuel of Akwa Ibom, Godwin Obaseki of Edo, Seriake Dickson of Bayelsa , Nasir el-Rufai of Kaduna and Atiku Bagudu of Kebbi states.

The meeting, which ended a few minutes after 8p.m, was also attended by the Minister of Finance, Kemi Adeosun, Minister of Budget and National Planning, Udo Udoma, and a representative of the NNPC Group Managing Director.

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