February 28, 2024
NNPC ready for forensic audit of fuel supply

NNPC ready for forensic audit of fuel supply

The Nigerian National Petroleum Company Limited (NNPC Ltd) has offered to submit itself to a forensic audit of its fuel supply and subsidy management, claiming a daily fuel supply of 68 million litres.

The NNPC announced this in a statement signed by Malam Garba Muhammad, Group General Manager, Group Public Affairs Division, NNPC, on Sunday.

According to Muhammad, the total volume of Premium Motor Spirit (PMS) imported into the country between January and August 2022 was 16.46 billion litres, translating to an average supply of 68 million litres per day.

 

Similarly, he stated that imports in 2021 would total 22.35 billion litres, translating to an average supply of 61 million litres per day.

“According to the Nigerian Midstream and Downstream Petroleum Regulatory Authority, the average daily evacuation (depot truck out) from January to August 2022 is 67 million litres per day” (NMDPRA).

“While daily evacuation (depot load outs) records of the NMDPRA do carry daily oscillation ranging from as little as four million litres per day to as much as 100 million litres per day,” he explained.

He claimed that rising crude oil prices and PMS supply costs above the PPPRA (now NMDPRA) cap had caused oil marketing companies to stop importing PMS since the fourth quarter of 2017.

In light of these challenges, he stated that NNPC had remained the supplier of last resort and had continued to report monthly PMS cost under-recoveries to the relevant authorities in a transparent manner.

In terms of cost, he stated that the average international market determined landing cost in the second quarter of 2022 was 1,283 dollars per Metric Tonnes and N46 per litre approved marketing and distribution cost.

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“The combination of these cost elements results in a retail pump price of N462/litre, an average subsidy of N297/litre, and an annual estimate of N6.5 trillion based on a daily PMS supply of 60 million litres.”

The NNPC promised to ensure compliance with the existing governance framework, which requires relevant government agencies to participate in all PMS discharge operations.

“Among the agencies are the Nigerian Ports Authority, NMDPRA, Nigerian Navy, Nigeria Customs Service, NIMASA, and others,” Muhammad explained.

He recognized the potential for criminal activity in the PMS supply and distribution value chain.

Muhammad, on the other hand, pledged that, as a responsible business entity, NNPC would continue to collaborate with relevant agencies to combat PMS smuggling and other criminal activities.

He also promised that the company would carry out its mandate of ensuring the country’s energy security with integrity and transparency.

(NAN)

NNPC ready for forensic audit of fuel supply

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