Our reporter/ The federal government paid N169.4 billion as subsidy in August to keep the pump price at N620 per litre despite the boast by President Bola Tinubu that subsidy is gone forever.
There have been several reports suggesting that the current price stagnation despite the worsening exchange rate and international crude price crossing $95 a barrel suggests a return of subsidy.
According to a document by the Federal Account Allocation Committee (FAAC), in August 2023, the Nigerian Liquefied Natural Gas (NLNG) paid $275m as dividends to Nigeria via NNPC Limited. NNPC Limited used $220m (N169.4 billion at N770/$) out of the $275m to pay for the PMS subsidy. Then NNPC held back $55m, illegally.
The revelation by FAAC effectively indicates that the subsidy is back and NNPC is now taking NLNG dividends to pay the subsidy.
The move to make the payment of N169.4 billion has the blessings of president Tinubu, sources familiar with the transaction told a national publication.
“If that payment was not approved, the country would have been thrown into serious crises because it was clear that the public could not bear in further depreciation in pump price, so something had to give.”
According to the source, a subtle deal had to be also struck with oil marketers to keep the current price.
“Everything has been done to not offset the market balance until we are able to resolve the production with Dangote refinery as well as the loans, once this is settled, we should see some stability,’ the source said.
With Daily Trust report
Leave a Reply