The Nigerian National Petroleum Corporation (NNPC) has disclosed the source of the $1.05 billion revolving fund it said it uses to support its supply of petrol to Nigerians since private oil marketers stopped importing and supplying petrol in the country.
According to the corporation, the $1.05 billion was sourced from dividend accruals to it from its investment in the Nigerian Liquefied Natural Gas Limited (NLNG) Limited. In the NLNG, the NNPC holds 49 per cent shares, while Shell; Total; and ENI hold 25.6 per cent 15 per cent and 10.4 per cent shares in the liquefied natural gas business.
However, in a statement sent to THISDAY on Friday in Abuja by the Group General Manager, Public Affairs of the NNPC, Mr. Ndu Ughamadu, the corporation denied keeping a $3.5 billion subsidy slush fund for underhand payments of differentials in the pump price of petrol which a legislator alleged against it.
In the statement, NNPC’s Group Managing Director, Dr. Maikanti Baru, explained in a presentation he made to Senate Ad hoc committee set up to investigate the existence of the said fund that the assertion was totally different from the reality on ground.
The ad hoc committee, led by Senator Ahmad Lawal, was according to the statement informed by Baru that what was in operation was a $1.05 billion fuel support fund created by the NNPC in response to an earlier call by the National Assembly at the peak of Nigeria’s petrol supply crisis that the NNPC put an end to the scarcity.
He stated that the order by the legislators made NNPC raise a revolving fund of $1.05 billion sequestered from its dividends from the NLNG, adding that the corporation had no hesitation in acceding to the legislators’ order.
Baru noted that the NNPC had since then become the sole importer and supplier of petrol in the country, and that from inception, the fund had been domiciled in the Central Bank of Nigeria (CBN) but not in the custody of the NNPC.
He said: “For the avoidance of doubt, let me restate that the fund had been jointly managed by the NNPC, the Central Bank of Nigeria (CBN), the Federal Ministry of Finance, the Petroleum Products Pricing Regulatory Agency (PPPRA), Office of the Accountant General of the Federation (OGF), the Department of Petroleum Resources (DPR), and the Petroleum Equalisation Fund (PEF).”
Baru, equally declared that the NNPC did not independently spend from the fund which he noted was primarily set up to ensure stability in petroleum products supply in the country by providing enough volumes to augment the petrol supply from the Direct-Sale-Direct-Purchase (DSDP) framework.
He stated that the NNPC was fully aware that only the National Assembly has the statutory responsibility to appropriate on petroleum subsidy matters, adding that the fund was designed to take care of the under-recovery arising from the extra volumes which the DSDP could not capture.
He also called on the National Assembly to support the enthronement of enabling environment that would ease the participation of marketers in petroleum products importation, adding that it is not in the best interest of the corporation and the nation to maintain the prevailing NNPC’s monopoly in the subsector.
The statement quoted Lawal to have said the committee would pursue the investigation to a logical conclusion.