(Bloomberg) -- Nigeria's state-owned energy company assured it will continue to meet its financial obligations to the government despite indicating the cost of gasoline subsidies may make it impossible to contribute to the national purse next month.
The Nigerian National Petroleum Corp. “is conscious of its role and was doing everything possible to shore up revenues and support the Federation at all times,” the company's spokesman, Kennie Obateru, said in a statement Friday.
The NNPC, the sole importer of gasoline, is absorbing the difference between the cost at which it purchases the fuel and sells it to wholesalers and retailers. This is after President Muhammadu Buhari delayed a plan to phase out the expensive subsidies due to fears that any price increase will cause social unrest.
Nigeria Fuel Subsidies Near $300 Million a Month, NNPC Says (1)
The national oil company recorded a shortfall of 112 billion naira ($294 million) in February in order to keep the gasoline price steady, the company's general managing director, Mele Kyari, said in a letter to the country's accountant general, Ahmed Idris, on April 28. The same amount will be deducted from the firm's monthly provision to the government in May, “which will translate to zero remittance” to the treasury, it said.
The NNPC has taken the decision to “ensure the continuous supply of petroleum products to the nation and guarantee energy security,” according to Kyari's letter.
©2021 Bloomberg L.P.
Essential Business Intelligence, Sharp Market Insights, Practical Personal Finance Advice, Daily Fuel, Gold and Silver Prices and Latest Stories — On NDTV Profit.
