The Nigerian National Petroleum Company Limited, NNPC Ltd, says it was open to forensic audit of premium motor spirit, PMS, consumption in the country.
The Comptroller General of the Nigerian Customs Sservice, Col. Hameed Ali (retd) had expressed doubt as to the actual PMS consumption in the country while appearing before the House of Reps Committee on Finance at a hearing on the 2023 Medium Term Expenditure Framework, MTEF, last week, in Abuja.
Ali said the N6.34tn subsidy payment annually was grossly exaggerated and should be checked.
The NNPC Ltd in a statement on Sunday by its Group General Manager, Group Public Affairs Division, Mr. Garba Deen, said, “we invite any forensic audit of the PMS supply and subsidy management framework of the NNPC.”
According to him, between January and August 2022, the total volume of PMS imported into the country was 16.46 billion litres, which translates to an average supply of 68 million litres per day.
“NNPC limited also note the average Q2, 2022 international market determined landing cost was US$1,283/MT and the approved marketing and distribution cost of N46/litres. The combination of these cost elements translates to retail pump price of N462/litres and an average subsidy of N297/litres and an annual estimate N6.5 trillion on the assumption of 60million litres daily PMS supply. This will continuously be adjusted by market and demand realities.”
He further explained that 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 & PMS supply costs above PPPRA (now NMDPRA) cap had forced oil marketing companies’ (OMCs) withdrawal from PMS import since the fourth quarter of 2017.
“In the light of these challenges, NNPC has remained the supplier of last resort and continue to
transparently report the monthly PMS cost under recoveries to the relevant authorities.”
He expressed the confidence that the oil company would continue to ensure compliance with existing governance framework that requires participation of relevant government agencies in all PMS discharge operations, including Nigerian Ports Authority, Nigerian Midstream and Downstream Petroleum Regulatory Authority, Nigerian Navy, Nigeria Customs Service, NIMASA and all others.
Deen, however, noted that 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.”
