The Nigerian National Petroleum Company Limited (NNPCL) said a litre of Premium Motor Spirit, also known as petrol, would have been sold for N426 if not for subsidy being paid on the product by the Federal Government.
Group General Manager, Group Public Affairs Division, NNPC LTD, Garba Deen Muhammad, disclosed this in a statement at the weekend.
According to him,at the moment, the government pays N297 per litre for the 68 million litres of petrol consumed daily.
Recall that NNPCL claimed that between January and August 2022, that a total volume of16.46 billion litres of PMS, translating to an average supply of 68 million litres per day, had been imported into the country.
It equally claimed that imports in the year 2021 was 22.35 billion litres, amounting to an average supply of 61 million litres per day.
“The NNPC Ltd notes the average daily evacuation (Depot truck out) from January to August 2022 stands at 67million litres per day as reported by the Nigerian Midstream and Downstream Petroleum Regulatory Authority, NMDPRA. Daily Evacuation (Depot loadouts) records of the NMDPRA do carry daily oscillation ranging from as low as 4 million litres to as high as 100 million litres per day, Muhammad said.
He said that “rising crude oil prices and PMS supply costs above PPPRA (now NMDPRA) cap had forced oil marketing companies’ (OMCs) withdrawal from PMS import since the fourth quarter of 2017.
“In the light of these challenges, NNPC has remained the supplier of last resort and continues to transparently report the monthly PMS cost under-recoveries to the relevant authorities.
“NNPC limited also notes the average Q2, 2022 international market determined landing cost was US$1,283/MT and the approved marketing and distribution cost of A46/litre. The combination of these cost elements translates to retail pump price of N462/litre and an average subsidy of N297/litre and an annual estimate of N6.5 trillion
“On the assumption of 60 million litres daily PMS supply. This will continuously be adjusted by market and demand realities.
“NNPC Ltd shall continue to ensure compliance with existing governance framework that requires participation of relevant government agencies in all PMS discharge operations, including Nigerian Ports Authority, Nigerian Midstream and Downstream Petroleum Regulatory Authority, Nigerian Navy, Nigeria Customs Service, NIMASA and all others”.
He further said that NNPCL “recognizes the impact of maritime and cross border smuggling of PMS on the overall supply framework. NNPC also acknowledges the possibilities of other criminal activities in the PMS 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 smuggling of PMS and contain any other criminal activities”.