The Nigerian National Petroleum Corporation (NNPC) has disclosed that its monthly remittance to the Federation Accounts Allocation Committee (FAAC) for the month of May 2021 may be zero.
Mallam Mele Kyari, Group Managing Director of the Nigerian National Petroleum Corporation, in a letter addressed to the Accountant General of the Federation, had indicated that N111.96 billion will be deducted from April 2021 oil and gas proceeds due the Federation in May 2021.
He explained that the deduction is necessary to ensure the continuous supply of petroleum products to the nation and guarantee energy security.
In the letter under reference, the Group Managing Director of the NNPC invited the Accountant General of the Federation to note that the average landing costs for Premium Motor Spirit, popularly known as petrol, for the month of March 2021 was N184 per litre against the subsisting ex-coastal price of N128 per litre, which has remained constant notwithstanding the changes in the macro-economic variables affecting petroleum products pricing.
The letter reads in part:
“As the discussions between Government and the Labour are yet to be concluded, NNPC recorded a value shortfall of N111.966,456,903.74 in February 2021 as a result of the difference highlighted above.
“Accordingly, a projection of remittance to the federation for the next three months is presented in the attached schedule”.
A zero remittance from NNPC will affect the monthly allocation to states in the coming months, which may make them unable to meet their statutory obligations such as payment of salaries to workers in their respective states.