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NNPCL reveals N4.2 trillion is needed to fix Nigeria's subsidy payments in 2023

The apex petroleum regulatory body, the Nigerian National Petroleum Company Limited, NNPCL has revealed that in other to meet the increasing volume of petroleum products, the sum of N4.32 trillion would be needed to offset the subsidy costs of petroleum products in 2023.

NNPCL reveals N4.2 trillion is needed to fix Nigeria's subsidy payments in 2023

This position was revealed by the group managing director, Engr Melee Kyari when he spoke to Channels TV during an interview.

Kyari based his assumptions on the calculations of the recent fuel distribution logistics and according to him, the group currently transfers products (PMS) to oil marketing companies at N113 per liter so that a fixed market price of N170 can be established.

This exercise which started off years ago formed the basis of the estimates used by the NNPCl but recent realities on ground like some adjustments on the cost of vessels and logistics payments have necessitated a switch in the payment modules and pricing figures.

Kyari however, added that despite the fluctuating prices, the NNPCl has maintained the transfer price from our landing location to the marketing companies.

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Speaking further, the NNPC boss further revealed that fresh data obtained recently showed that at entry, these products came with a price tag of N295 per liter once they landed in the country, meaning the marketing companies would buy at N113 so that they will be able to maintain the current subsidy regime.

This leaves a balance of N185 per liter of subsidy on every product that comes into this country.

Kyari further added that when the accumulated product which amounts to 63 million liters used from January to date is calculated and converted to 365 days, that means the FG will need N4.27 trillion to meet the subsidy requirements for this country.

On the way forward, Mele Kyari noted that one of the major plans of the NNPCl was to quicken the process for the rehabilitation of the older refineries and also, follow up with the new Dangote Refinery to ensure it starts working optimally so that petroleum products can become close to Nigerians.

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