Nigeria currently incurs over N1.4 trillion yearly as under-recovery or losses on the importation and sale of petrol, minister of Petroleum Resources, Dr. Ibe Kachikwu, said yesterday.

The minister made the revelation at a workshop on the Harmonization of Liquefied Petroleum Gas (LPG) Regulatory Requirements in Abuja.

According to Kachikwu, the government through the Nigeria National Petroleum Corporation (NNPC), continues to shoulder such huge burden because of the over reliance of the country on premium motor spirit otherwise called petrol.

He said, “The need for clean energy is very essential. We need to move away from the complete (reliance) of our transport sector on PMS. It is creating a lot of under-recovery of over N1.4 trillion around exposures to the government,” the minister said.

He added that, “the earlier we can begin to move into other components of cleaner fuels and rely less on PMS, the safer it will be. The issues of fuel queues will disappear.”

Daily Trust reports that there has been controversy over whether to classify the under-recovery on PMS as outright subsidy or just business losses.

The amount announced by the minister is more than the average N1 trillion appropriated and spent yearly as subsidy payments from 2006 to 2016 when the subsidy scheme was administered.

NNPC has severally explained that there was N774 million under-recoveries in the importation and sale of PMS but the burden was categorized as business losses which the Act establishing NNPC recognizes.

The losses, from the PMS imports, according to the corporation, could not be classified as subsidy since it was not appropriated for by the National Assembly.

Minister of Finance, Mrs. Kemi Adeosun, while answering questions from journalists in Abuja recently explained that there was no subsidy but under-recovery because the NNPC was currently doing all the importation.

“They are importing at a higher price than they are selling, which means they are losing money, which means effectively that that loss is being borne by everybody and effectively it reflects in the Federation Account,” she said.

“So, there is no subsidy payment in the way the old subsidy scheme used to work where they were paying the oil marketers, but there is an under recovery, a loss on the importation of the PMS being borne by the NNPC and therefore indirectly being borne by everyone one of us,” she said.

Kachikwu when asked in an interview with journalists after the LPG workshop to confirm the N1.3 trillion under-recovery figure said, “Yes, currently!”

When asked to give details the minister said “let me focus on the gas issue, that (under-recovery) is being addressed at a very high level and I am sure if you talk with NNPC to give a lot more detail on that. I don’t want to work that issue here,” he said.

https://www.dailytrust.com.ng/nigeria-incurs-n1-4tr-under-recovery-on-petrol-yearly-kachikwu.html

Between throwing 1,4 trillion away annually and investing such in refinery, that will create jobs and make the commodity more available regularly and cheaper, which is .more beneficial to the ordinary Nigerians.The logic of wastefulness is what I don't understand.

surgical:
Between throwing 1,4 trillion away annually and investing such in refinery, that will create jobs and make the commodity more available regularly and cheaper, which is .more beneficial to the ordinary Nigerians.The logic of wastefulness is what I don't understand.

Oh?! the wishful thinkers want "Clean" energy now? Don't tell me Petroleum industry don dey cast for dem PIB & all?

Just when Unilag eggheads are warming up "to start applying for BOI funds for building refineries with which they'd better understudy & master the process".
Arrested Development on steroids!

Anyway, these guys can't do jack, 'cos they don't know shyt:. Na here fuel crises and price hike go take grow, go school, marry born pikin .

And what the Dullard has to say about it will be positively hilarious, you wait for it

They are importing at a higher price than they are selling, which means they are losing money, which means effectively that that loss is being borne by everybody and effectively it reflects in the Federation Account,” she said.

“So, there is no subsidy payment in the way the old subsidy scheme used to work where they were paying the oil marketers, but there is an under recovery, a loss on the importation of the PMS being borne by the NNPC and therefore indirectly being borne by everyone one of us,” she said.

Contradicting statements in bold.

Just say we are paying subsidy, nobody would beat you.

When oil flows, it flows with corruption. When it flows in Nigeria, it flow with waste.

So under recovery is the new name this government calls subsidy??

They are so ashamed to admit they are paying subsidy after all the noise they made before getting into power.

God punish Buhari and his supporters.

Shiithole country indeed.

Buhari and Osinbajo should join The NASS to Restructure the 36 States and let the States handle their Resources, Elections and internal Securities themselves.

Why is he telling us the problem that they voted them to solve...


I think in APC mind they still believed they are the opposition.

This is worse than subsidy on Jonathan's era , so now we spend twice the amount for fuel and the Buhari govt spends more on "under recovery " which is an APC Coined Lie for SUBSIDY...Such a shame ..Sombody should be on jail for trying to replace the word subsidy with under recovery in order to steal and lie to Nigerians

lol...

In other words, buhari's destructive govt incurs N1.4 trillion in SUBSIDY YEARLY. The same subsidy the illitrate occupying Aso Villa said he doesnt understand and was not budgeted for in 2016-2017 budget, nor was it approved by NAS? But it is still being payed anyway through the back door and no one is talking about this Impunity and Abuse of power

Nigerians will get the full information about the activities of NNPC in 2019. The corruption going on in that sector under APC's incompetent rudderless govt is mind blowing!!
This govt has virtually turned NNPC into a family business where any goes without any form of accountability and transparency.

Did anyone read this portion?
The amount announced by the minister is more than the average N1 trillion appropriated and spent yearly as subsidy payments from 2006 to 2016 when the subsidy scheme was administered

This government is a fraud
How can we pay more for subsidy when with the higher pump price borne by the masses?

Also deceptive by renaming subsidy to underecovery

enlady:
Did anyone read this portion?
The amount announced by the minister is more than the average N1 trillion appropriated and spent yearly as subsidy payments from 2006 to 2016 when the subsidy scheme was administered

This government is a fraud
How can we pay more for subsidy when with the higher pump price borne by the masses?

That is why they are looking for ways to increase fuel price to cover for the so call under recovery (Subsidy).
No doubt the former administration were more honest in subsidy payment compared this this useless govt.
Bunch of incompetent fellows.

Authority stealing crew, just say it is subsidy instead of that your long turenchi

"There's nothing like fuel subsidy" *in Bubu's voice

If that was the case as clearly stated when they increased fuel price from 87.6 to 145 then somebody is helping themselves BIG time to the national cake!

#CleansweepBuhari #CleansweepIgnatius

Chai, the Aso rock cabals are just using Buharis inefficiency to loot Nigeria treasury.

Another Professional Criminal (APC).