NNPC records N336.83b deficit, as subsidy, crude theft increase
BESIDE recording operational loss of
N120 billion in August and September,
the Nigerian National Petroleum
Corporation (NNPC) suffered a N336.83
billion deficit in September in its
domestic operations.
The latest financial/operations report of
the corporation obtained by The
Guardian, showed that huge deficit was
recorded in the operations of the
Pipeline Product Marketing Company
(PPMC) comprising mainly claimable
subsidy of N249.15 billion, rising from
N231 billion recorded in the previous
report.
Indeed, the report identified other
causes of the deficit to include repairs
and management cost of N73.97 billion
and crude/product losses of N48.82
billion due to pipeline vandalism.
Besides, the NNPC paid N790.75 billion
for domestic crude oil and gas and other
receipts to the federation account from
January to September 2015.
About $225.7 million was paid to the
federation account from the sales of
export of crude oil, gas and Nigerian
Liquefied Natural Gas (NLNG) Feedstock
for the month of August 2015 alone.
NNPC, which made this disclosure in its
monthly report released at the weekend,
explained that crude oil export sales
contributed $108.9 million about 48 per
cent of the dollar payment compared
with 76 per cent contribution in
previous month of July 2015 while
export gas sales and NLNG feedstock
accounted for $99.65 million i.e 44 per
cent contribution compared with 23.7
contribution in the prior month of July
2015.
According to NNPC, the remaining $16.8
million was attributable to other dollar
denominated receipts by the
corporation. A total of $607.8 million
has been paid so far to FAAC in the year
2015 from sales of export oil and gas.
It stated that the total export crude oil
and gas receipt for the period of January
to September 2015 is $3.69 billion. “Of
the total receipts, the sum of $0.61billion
was remitted to Federation Account
while the balance of $3.09 billion was
used to fund the Joint Venture (JV) Cash
Call for the period. The dwindling oil
price has negatively affected the NNPC
Dollar contribution to the Federation
Account. The continued decline in oil
price led to insufficient cash available to
meet JV cash calls obligations of about
$615.8 million monthly as appropriated
by the National Assembly. To mitigate
this effect, NNPC was
compelled to sweep all the export receipt
to JV Cash Call funding implying a zero
remittance to federation account since
the month of April 2015”, it added.
It noted that the corporation federation
crude oil and gas liftings are broadly
classified into equity export crude and
domestic crude.
NNPC explained that both categories are
lifted and marketed by NNPC and the
proceeds remitted to the federation
account.
“Monthly export receipts are paid
directly into JP Morgan Account operated
by Central Bank of Nigeria (CBN), after
adjusting for calenderized Joint Venture
(JV) cash calls, being a first line charge
as provided in the appropriation bill; the
balance is transferred to the federation
account. Domestic crude oil of
445,000bopd is allocated for refining to
meet domestic products supply.
“This volume is utilized through various
arrangements such as domestic refining,
offshore refining (Offshore Processing
Arrangement: OPA), crude for product
exchange and direct export. The net
proceeds after adjusting for fuel subsidy,
crude and product losses and pipeline
repairs and management cost are
remitted to the federation account”, it
added.
Group operating revenue before subsidy
for the months of August and September
2015 were N146.53 billion and N112.51
billion respectively.
This represents 47.88 per cent and 36.77
per cent respectively of monthly budget.
Similarly, operating expenditure for the
same periods were N207.37 billion and
N171.91billion respectively, which also
represents 77.64 per cent and 64.36 per
cent respectively of budget for the
months.
It noted that operating deficits of N60.84
billion and N70.44 for August and
September 2015 respectively was
attained as against monthly budgeted
surplus of N38.91billion.
NNPC maintained that production by the
refineries in September amounted to
75.78 million litres compared to 200.25
million litres in August.
On downstream petroleum products
distribution, the corporation said 507.90
million litres of white products were
distributed and sold by PPMC in
September compared with 606.84 million
litres in August.
This comprised 456.81 million litres of
petrol, 31.41 million litres of kerosene
and 19.68 million litres of diesel.
Total sale of white products by the
NNPC/PPMC between January and
September, it said, stood at 6.41billion
litres, with petrol (5.08 billion litres)
accounting for 79 per cent.
During the period under review,
according to NNPC, only Port Harcourt
Refinery Corporation (PHRC) produced
31,008million MT of petroleum products
out of 35,648 MT (261,371.14 bbls) of
crude processed at an average capacity
utilisation of 5.77 per cent.
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