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Saturday, March 19

NNPC Made No Dollar Remittance To Federation Account For 8 Months

NNPC Made No Dollar Remittance To Federation Account For 8 Months

The Nigerian National Petroleum Corporation NNPC has taken all the profits it made from oil and gas exports since April, 2015 to service Joint Venture (JV) Cash Call funding, implying, according to the report, a zero remittance to Federation Account from its operations.

The oil company report made available yesterday showed that it’s losses rose to N255.28 billion from N240.98bn recorded in October. The firm’s loss for the month of November alone was N14.29bn up from N12.22bn recorded in October.

For instance, in November, the corporation recorded $402.55 million as proceeds from Crude oil sales, LPG, NLNG Feedstock as well as miscellaneous receipts.

It diverted all the $402.55 million receipts to fund JV Cash Call obligation. It said the $402.55m even fell short of the $615.8m monthly requirement to fund its JV cash call.
A total of N255.28bn was lost by the NNPC between January and November this year, latest figures from the firm’s monthly financial and operations report for November 2015 have shown.
The last remittance to the Federation Account by the corporation was $184.9bn in April.

59.6% of the losses were attributed to mainly claimable pipeline repairs/management cost of N95.37bn, crude and product losses of N56.68bn due to vandalized pipelines.

The corporate headquarters of the oil firm posted the heaviest loss till date with N153.32bn. Its product supply and distribution arm, the Pipelines and Products Marketing Company (PPMC) posted N69.60bn while all the three refineries are listed to have lost over N70bn till date.
Like in October, the refineries also recorded zero capacity utilisation in the month of November just as they recorded a loss of N7.21 billion for the latest month.

“Total crude processed by the three refineries for the month of November 2015 was zero,” the report said.

NNPC blamed the continued decline on oil price and consequent deterioration in crude oil and gas receipt as the major reasons for the shortfall and subsequent non- remittance to the federation account.

The report said, “Total export crude oil and gas receipt for the period of January – November 2015 is $4.54 billion. Of the total receipts, the sum of $0.61 billion was remitted to Federation Account while the balance of $3.94 billion was used to fund the JV Cash Call for the period. Thus JV funding has gulped more than 86% of the proceeds”

Giving explanations for the decline, it said, “The deterioration in Crude Oil and Gas receipt is in response to continued decline in oil price. Thus the proceeds are no longer sufficient to service the JV Cash Call obligation and remit to Federation Account. JV cash call is a first line charge to Federation Account and 2015 Approved Budget requires monthly funding of about $615.8m.

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