FG, States Finances in Trouble, Salary Cut Looms as NNPC Again Fails to Remit N1.89trn Crude Oil Sales Revenue

• The Nigerian National Petroleum Corporation (NNPC) has announced it has no money to share to federal states and local governments
• Providing breakdown of its finance NNPC revealed it made N1.89 trillion in five months but most of the money has been spent
• World Bank has expressed concern that Nigeria could be heading for a massive fiscal crisis due to continue subsidy payments

On Monday, the Nigerian National Petroleum Corporation (NNPC) revealed it failed to remit monies to the federation account in May 2022 despite making N470.61 billion.

This is the fifth straight months, NNPC has failed to add a kobo to the federal account while announcing a whopping N1.89 trillion revenue, N238.137 billion more than earlier projected revenue.

NNPC deficit payment to the federation account is now a whopping N704 billion, which is giving serious headache to states.

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Details of NNPC June FAAC report most of the revenue received by NNPC from crude oil sales has been pumped back to petrol subsidy, oil search, Pipeline Security & Maintenance cost, National Domestic Gas Development and Nigeria Morocco Pipeline cost among others.

The development has caused the World Bank in its latest Nigeria Development Update report say Nigeria is facing a potential fiscal time bomb.

Why no money from NNPC?

As earlier noted, NNPC made N1.89 trillion revenue but spent N1.27 trillion, went on petrol subsidy.

In fact, NNPC has informed FAAC that it would deduct N845 billion from June proceeds due for sharing at the July FAAC meeting, ThisDay reports.

Breakdown of NNPC subsidy payment in 2022

According to the NNPC presentation to the Federal Accounts Allocation Committee (FAAC) it paid N327.06 billion as subsidy in May, representing a 20.4 percent increase from the previous month and the highest on record this year.

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A further breakdown of the subsidy spending shows that the oil firm paid N210.38 billion, N219.78 billion, N245.77 billion, and N271.59 billion as subsidy on petrol in January, February, March and April, respectively.

NNPC sets date for completion of PH refinery

In other news, the Nigeria National Petroleum Company (NNPC) has revealed the date for the completion of the Port Harcourt refinery.

In 2021, NNPC during the award of the repair works contract to an Italian firm, Tecnimont promised 18 months of completion.

The repair works are expected to gulp over N539 billion($1.5 billion) NNPC believes it will be ready for use in a few months' time.

Source: Legit.ng