The Nigerian National Petroleum Company (NNPC) Limited was unable to remit 80 per cent of its projected contribution to the Federation Account in 2021.
NNPC recorded a deficit of approximately N2 trillion out of its projected N2.511 trillion, its data released recently revealed.
The date showed that in the entire 12 months of the period under review, the NNPC disbursed N542 billion as against the budgeted N2.511 trillion, given a monthly contribution forecast of N209.3 billion.
The N542 billion represents just about 21. 6 per cent of the total expected contribution of the company to the joint account operated by the federal government, states and local governments.
The development underscores how a combination of factors, including declining oil production, rising subsidy payments and high oil production costs hobbled the organisation’s performance despite the increasing international oil prices which averaged $85 last year.
President Muhammadu Buhari last week backtracked on the planned full deregulation of the downstream sector, including the wholesale removal of petrol subsidy, citing the negative impact it would have on the poor and the vulnerable in the country.
For decades, Nigeria’s attempt to fully free the downstream oil and gas industry has met with a brick wall even as the latest effort has been pushed forward by about 18 months, effectively exempting the current administration which will exit by May 2023 of any burden.
The company’s revenue slump is also partly blamed in high production costs despite fresh initiatives by the industry to cut cost per barrel, regarded as the highest in the world.
