NEC, FAAC approve use of $1.05bn NLNG dividends

The National Economic council (NEC) and the Federation Allocation Accounts Committee (FAAC) have approved the use of Nigeria Liquiefed Natural Gas dividends for financing of the petroleum products importation.

One of the members of FAAC, who spoke with Nigerian’s News on condition of anonymity, said that the Nigerian National Petroleum Corporation (NNPC) briefed the meetings before using the fund.

He said that the Group Managing Director of the NNPC, Dr Maikanti Baru had briefed NEC and FAAC on the NLNG dividends, which was paid to the corporation as a major shareholder.

It will be recalled that the President of the Senate, Dr Bukola Saraki had faulted the reported use of $1.05 billion, by the NNPC from its dividends from the NLNG for fuel subsidy.

Saraki expressed grave concern that the NNPC GMD was claiming that the illegal diversion of dividends from the NLNG, which should be paid into the Consolidated Revenue Fund of the Federation for the purpose of funding the fuel subsidy “was done ‘in compliance with the National Assembly’s directive that NNPC as the supplier of last resort should, and has maintained robust petrol supply”.

Another source in the Central Bank of Nigeria (CBN) further confirmed to NAN that the Corporation had sourced 1.05 billion dollars, a revolving loan, to finance the importation of Premium Motor Spirit, known as petrol into the country in 2018.

He said that Section 7 of the NNPC Act empowers the NNPC to defray costs from its revenue.

He further explained that the NNPC had fully compiled and had implemented the approved Treasury Single Account (TSA) laws in utilising the money, which is domiciled in CBN account.

According to the him, the fund is managed by inter-governmental agencies such as Ministry of Petroleum Resources, Ministry of Finance, Department of Petroleum Resources, Petroleum Equalisation Fund, among others.

He added that it was unfortunate for anybody to say NNPC had misappropriated the fund.

“There is nothing like 3.5 billion dollar subsidy claim; it is not true and it is also false alarm that the NNPC was mismanaging such account, the dividends of NLNG as we know is being properly managed,” he said.

Also, spokesperson of the NNPC, Mr Ndu Ughamadu, confirmed to Newsmen that the corporation operates a regime of under recovery, since it is only the National Assembly that could appropriate on fuel subsidy.

He said that the NNPC was a major shareholder of NLNG and the dividends of NLNG were paid into the corporation account, which the corporation manages.

“I want you to know that in this situation, there is nothing like subsidy payment as the Senate President had mentioned.

“The GMD had briefed both NEC and FAAC on this NLNG dividend; also you know that the National Assembly had asked the corporation to ensure adequate supply of products in the country.

“We used the 1.05 billion dollars revolving loan in question, to finance importation of product in the country,” he said.

Ughamadu noted that the corporation had addressed the Senator Ahmed Lawal-led Ad Hoc Committee on fuel importation and explained every details of its operations.