NNPC Incurs N24bn Monthly As Subsidy As Petrol Demand Hits 50m Litres Daily

NNPC Incurs N24bn Monthly As Subsidy As Petrol Demand Hits 50m Litres Daily

NNPC Incurs N24bn Monthly As Subsidy As Petrol Demand Hits 50m Litres Daily


Fresh reports from the Nigerian National Petroleum Corporation has it that it currently spend about N24bn monthly as subsidy on the daily consumption of Premium Motor Spirit (PMS) across the country.

NNPC also revealed that while petrol has hit 50million litres daily consumption, the amount being paid as subsidy was due to the proliferation of filling stations in communities outside the country such as the coastal borders and other international land.

The Group Managing Director, NNPC, Maikanti Baru, said the multiplication of filling stations had energised unprecedented cross-border smuggling of petrol to neighbouring countries, making it difficult to sanitise the fuel supply and distribution matrix in Nigeria.

According to the statement released by NNPC Group General Manager, Group Public Affairs Division, Ndu Ughamadu, Dr Baru made rhis disclosure when he led a Management Team of the Corporation on an official visit to the Comptroller General of Nigeria Customes Service, Col Hammed Ali (Rtd).

Baru stated that a detailed study conducted by the NNPC indicated strong correlation between the presence of the frontier stations and the activities of fuel smuggling syndicates.

He said the activities of the smugglers led to the recent abnormal surge in the evacuation of petrol from less than 35 million litres per day to more than 60 million litres per day, which was in sharp contrast with established national consumption pattern.

Providing a detailed presentation of the findings, the NNPC boss noted that 16 states, having among them 61 local government areas with border communities, accounted for 2,201 registered fuel stations.

He stated that the tanks of the facilities had a combined capacity of 144,998,700 litres of petrol.

Baru stated that in the same vein, eight states with coastal border communities spread across 24 LGAs accounted for 866 registered fuel outlets with combined petrol tank capacity of 73,443,086 litres.

He said a further breakdown of the findings showed that among the states with land border, three LGAs in Ogun State accounted for 633 fuel stations with combined petrol tankage of 40,485,000 litres, while nine LGAs in Borno State had 337 fuel outlets with combined petrol storage capacity of 21,114,480 litres.

According to him, Lagos with one LGA as border community has 235 registered fuel stations with total storage facility of 19,916,600 litres.

The statement noted that on the coastal front, Lagos with six LGAs led with 487 registered fuel stations with combined in-built storage capacity of 50,239,560 litres.

It said, “Akwa Ibom, with five LGAs, has 134 registered retail outlets with capacity to store 8,322,986 litres; while Ondo State, with two LGAs, has 110 fuel stations with capacity to store 3,871,320 litres.”

Baru explained that because of the obvious differential in petrol price between Nigeria and other neighbouring countries, it had become lucrative for the smugglers to use the frontier stations as a veritable conduit for the smuggling of products across the border, adding that this had resulted in a thriving market for Nigerian petrol in Niger Republic, Benin Republic, Cameroon, Chad and Togo, as well as Ghana, which has no direct borders with Nigeria.

He was quoted as saying, “The NNPC is concerned that continued cross-border smuggling of petrol will deny Nigerians the benefit of the Federal Government’s benevolence of keeping a fix retail price of N145 per litre despite the increase in PMS open market price above N171 per litre.”

He noted that based on the heightened petrol consumption rate of 50 million litre per day, the corporation was incurring an under-recovery of N774m every day.

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