The Nigerian National Petroleum Company (NNPC) Limited has claimed that the country’s average petrol supply is 68 million litres per day in reaction to the purported inflation of imports and consumption in Nigeria.
The corporation also revealed that the amount of gasoline imported into the nation overall between January and August 2022 was 16.46 billion litres or 68 million litres per day.
The claims were made by NNPC in a statement released and signed by Mr Garba Muhammad, Group General Manager, Group Public Affairs Division. Another development is that the Nigerian National Petroleum Corporation (NNPC) has secured a 20-year, 300,000 barrels per day crude supply agreement with Dangote Refinery as part of its 20% equity investment in the 650,000 barrels per day plant in Lagos.
The current explanation from NNPC came in response to assertions made last week by Col. Hameed Ali, Controller-General of the Nigeria Customs Service (NCS), that the firm had released 98 million litres of gasoline daily for domestic use rather than the 60 million litres it had calculated. Speaking during a meeting with National Assembly members last Thursday, Ali had also faulted the petrol subsidy regime, describing it as fraud and not existent.
However, in response to the allegations, NNPC highlighted in the statement that the total amount of gasoline imported into the nation between January and August 2022 was 16.46 billion litres.
According to the corporation, imports totalled 22.35 billion litres in 2021, translating to an average supply of 61 million litres per day.
A litre of gasoline would cost N462 if the gasoline subsidy was eliminated, according to the NNPC, which added that it was prepared for any forensic audit if the need ever came.
It was mentioned that the Nigerian Midstream and Downstream Petroleum Regulatory Authority revealed that the average daily evacuation (Depot truck out) from January to August 2022 was 67 million litres per day (NMDPRA). It explained that Daily Evacuation (Depot load outs) records of the NMDPRA do carry daily oscillation, ranging from as low as four million litres to as high as 100 million litres per day.
The state oil company also pointed out that the impact of maritime and cross-border smuggling of petrol might be affecting the overall supply framework, acknowledging the possibilities of other criminal activities in the supply and distribution value chain.
NNPC further stated that rising crude oil prices and petrol supply costs above the NMDPRA cap had forced oil marketing companies’ withdrawal from petrol imports since the fourth quarter of 2017.
In light of these challenges, the state oil firm explained that it had remained the supplier of last resort and continued to transparently report the monthly petrol cost under-recoveries to the relevant authorities.
The statement read: “The NNPC Ltd. wishes to inform members of the general public that between January and August 2022, the total volume of Premium Motor Spirit imported into the country was 16.46 billion litres, which translates to an average supply of 68 million litres per day.
“Similarly, import in the year 2021 was 22.35 billion litres, which translated 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 load outs) 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. “The NNPC also wishes to point out that rising crude oil prices and PMS supply costs above PPPRA (now NMDPRA) cap had forced oil marketing companies (OMCs) to withdraw 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.”
It also noted that the average first quarter (Q1) 2022 international market determined landing cost was $1,283 per metric tonne and the approved marketing and distribution cost of N46/litres. NNPC stated that the combination of these cost elements translated to a retail pump price of N462 per litre, an average subsidy of N297 per litre and an annual estimate of N6.5 trillion on the assumption of 60 million litres daily petrol supply.
Noting that the figures would continuously be adjusted by market and demand realities, NNPC said it shall continue to ensure compliance with the existing governance framework that requires the participation of relevant government agencies in all petrol discharge operations, including the Nigerian Ports Authority (NPA), (NMDPRA), Nigerian Navy (NA), (NCS), Nigerian Maritime Administration and Safety Agency (NIMASA) and all others.
“NNPC Ltd. recognises 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.
“NNPC will continue to engage and work with relevant agencies of the government to curtail smuggling of PMS 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 PMS supply and subsidy,” the statement added.
In another development, some energy experts and economic policy analysts have hailed NNPC for locking up a 20-year crude supply deal with Dangote Refinery as part of the benefits of its 20 per cent equity investment in the Lagos-based 650,000 barrels per day facility, describing it as a noble business decision. On the back of last week’s remarks by the Group Chief Executive Officer (GCEO) of NNPC, Mallam Mele Kyari, who for the umpteenth time, justified the company’s 20 per cent equity investment in the refinery.
Kyari had disclosed last week in Abuja that NNPC would have the first right of refusal to supply the Dangote refinery with about 300,000 barrels of crude oil per day for the next 20 years having acquired 20 per cent equity interest and minority shareholder in the facility.
He said the company had succeeded in locking up the huge supply as part of the federal government’s means of guaranteeing sufficient petroleum products supply for Nigeria as well as a guaranteed market for the nation’s crude oil.
“We have secured the right to sell up to 300,000 barrels of crude oil to the Dangote refinery for the next 20 years. Not only that, by right, we also have access to 20 per cent production from that plant,” Kyari had said.
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