NNPC gets Tinubu’s approval to use FG’s dividend to fund petrol subsidy

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President Bola Tinubu has approved Nigerian National Petroleum Company (NNPC) Ltd. request to use its 2023 final dividend to fund petrol subsidy.

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Checks by Vanguard, yesterday, also indicated the President has also granted an approval for the suspension of the payment of 2024 interim dividends as part of measures targeted at enhancing the cash flow of the organization.

According to NNPC, the cumulative petrol subsidy bill from August 2023 was expected to hit N6.884 trillion by December 2024, thus requiring the government support.

Meanwhile, NNPC, yesterday, released its 2023 Audited Financial Statement (AFS), declaring a net profit of N3.297 trillion at the close of the financial year which ended in December 2023, indicating an increase of 28 per cent (over N700 billion) when compared to the N2.548 trillion recorded in 2022.

However, in a world press conference held at the NNPC Towers in Abuja, the Chief Financial Officer of the Company, Mr. Umar Ajiya said the release of the AFS is a testament to the Company’s commitment to transparency and accountability.

He said: “Our fiscal performance reflects both strategic foresight and operational resilience. Despite inherent challenges of our operational and economic environment, we have improved the productivity and the financial performance of this great company.

Ajiya said that posting such impressive returns demonstrates NNPC Ltd’s commitment to sustaining profitability and supporting the attainment of national energy security as stipulated by the Petroleum Industry Act (PIA) 2021, and by extension, as expected by the Company’s shareholders.

Explaining that the NNPC Ltd will announce Initial Public offer (IPO) once the shareholders and Board make a decision, Ajiya also debunked claims on subsidy payment, saying the Company was only taking care of PMS importation shortfall between it and the Federation.

Similarly, the Chairman of the NNPC Ltd Board, Chief Pius Akinyelure said that the excellent performance came as the fruit of the PIA 2021, the commitment of the Board, Management and staff of the company.

Akinyelure added that the shareholders of the company have since approved a final dividend of N2.1trn in line with PIA 2021 provisions.

On her part, the Executive Vice President, Upstream, Mrs. Oritsemeyiwa Eyesan said with improvements witnessed as a result of the renewed vigour in the war against crude oil theft and pipeline vandalism, NNPC Ltd is targeting 2 million barrels per day crude oil production by the end of the year.

Meanwhile, checks by Vanguard could not confirm the total amount of dividends to be withheld by the Company to enable it fund the petrol subsidy as Chief Corporate Communications Officer, NNPC Ltd., Olufemi Soneye, could not be reached for comments, yesterday.

But based on its 2023 Audited Financial Statement (AFS), the Company declared N2.1 trillion dividend at the close of the financial year which ended in December 2023.

However, NNPC informed President Tinubu in June 2024 that the subsidy payments were becoming unbearable, calling for urgent intervention.

The NNPC Ltd. also pointed out that some factors, including foreign exchange pressure have worsened the financial condition of the organization, making it difficult to sustain petrol importation.