Payment Terms

NNPC eyes 422 billion naira from six CIOs in August

Six international oil companies are due to pay a total of N442.37 billion in August 2022, from the sale of domestic crude oil in May 2022, according to figures obtained from the Nigerian National Petroleum Company Limited on Monday.

The NNPC explained that the 422.37 billion naira represents 8.887 million barrels of oil for May 2022 domestic crude payable in August 2022, adding that the six companies are joint venture partners of the national oil company.

He outlined companies to include: Chevron Nigeria Limited, Mobil Producing Nigeria and Nigerian Petroleum Development Company, NNPC’s flagship upstream subsidiary.

Others include: Total Exploration and Production Nigeria, First Exploration and Production, as well as Addax Petroleum.

Figures from the oil company showed Chevron will pay N162.24 billion for 3.49 million barrels of crude oil, while N90.06 billion for 1.9 million barrels of crude is expected from Mobil ce this month.

NPDC and Total are to hand over N41.13 billion and N47.26 billion respectively for 948,296 and 948,776 barrels of crude oil.

Similarly, the recently commercialized company said that First E&P and Addax will pay N33.498 billion and N48.188 billion for 650,071 and 948,251 barrels of crude oil in August.

In its remarks on the funds to be remitted by the companies, the national oil company said it was “May 2022 domestic crude oil payable in August 2022 by NNPC in accordance with 90-day payment terms.”

The NNPC sends remittances from the sale of crude oil to the Federation account, which are shared monthly by the three levels of government.

However, he has been unable to send remittances since this year due to the huge amount he spends on Premium Motor Spirit grant commonly known as gasoline.

The NNPC has been the sole importer of gasoline in Nigeria for several consecutive years and has assumed the burden of gasoline subsidies on behalf of the Federal Government, a development which has prevented it from disbursing funds to the Federation’s account.

Although proceeds from the May 2022 oil sale of N422.37 billion are expected in August 2022, the NNPC has recently declared that it will no longer make payments to the Federation Accounts Monthly Allocation Committee.

The company’s Group Managing Director, Mele Kyari, disclosed this in July during the company’s official unveiling in Abuja as a business entity.

Kyari had also clarified in July that gasoline subsidies were now the responsibility of the federal government and not the responsibility of the oil company, pointing out that the company was now a private company and no longer had anything to do with the FAAC.

Responding to a question about what would happen to NNPC’s monthly contributions to FAAC, while speaking on the sidelines of the NNPC unveiling, kyari said, “We are now a private company; Would MTN go to the FAAC?

When questioned further about whether there would be any more FAAC payouts from the company in the future, he said: “We will pay our taxes, our royalties and we will pay dividends to our shareholders. ”

Asked about the arrears to FAAC that have not been settled by the firm over the years, the CEO replied: “What arrears? It is the Nigerian National Petroleum Corporation.

On how the oil company would handle fuel subsidies as a business entity, Kyari replied that fuel subsidies were not a burden on NNPC.

The CEO said, “The subsidy is not the burden of NNPC. Subsidies are the decision of the state and in all jurisdictions of the world, countries see them differently. In some countries, they add an oil tax to the market price of these products.