NNPC remits $607.8m to FAAC this year

The Nigerian National Petroleum Corporation (NNPC) has paid a total of $607.8 million into the Federation Accounts Allocation Committee (FAAC) this year from sales of oil and gas.

A breakdown of this figure indicates that the total export of crude oil and gas receipt for the period of January – August 2015 amounted to $3.420 billion. Of the total receipts, the sum of $0.61 billion was remitted to Federation Account as dollar proceeds while the balance of $2.815 billion was used to fund the JV Cash Call for the period.

This is contained in the monthly publication the NNPC has just started with the aim of making available to the public what activities it engaged in the course of the month.

This is in line with its earlier pledge made by Emmanuel Ibe Kachikwu, the group managing director of NNPC, who had promised to open up the books of the Corporation for public scrutiny.

The publication according to Ohi Aligbe, the group general manager, public affairs, is expected to give an overview of NNPC’s operations across the oil and gas value chain (Upstream, Midstream and  Downstream) as well as NNPC’s agency function on behalf of government from the period January to August 2015.

Specifically, the report provides detailed and unprecedented statistical insight into crucial aspects of the Corporation’s activities ranging from national crude oil and natural gas production, lifting and utilisation; refineries plants operations; and petroleum product supply and distribution to NNPC Budget Performance Report and Federation Crude Oil & Gas Revenue.

He said the publication contains a lot of illustrations with tables, graphs and charts, and vividly throws light into aspects of NNPC’s operations that were once described as ‘opaque.’

“Issues like the status of the once misunderstand JP Morgan Foreign account, management and custody of revenue from crude oil sales, actual production capacity of the refineries, dollar accruals to NNPC/FGN from export crude oil and gas, as well as receipts and payments are laid bare,” he said.

The report  however notes that the receipts witnessed a sharp decline of more than 67 percent from September, 2014, when the receipt was at its peak, to July, 2015 with dire consequences to the Federation.

The NNPC informed that the continued decline in oil price led to insufficient cash available to meet monthly JV Cash Calls obligations of about $615.8m as appropriated by the National Assembly. To mitigate this effect, NNPC was compelled to sweep all the export receipt to JV Cash Call funding implying a zero dollar proceed remittance to the Federation Account since the month of April 2015. The sum of N723.82 billion for Domestic Crude Oil and Gas Sales proceeds has been paid to the Federation Account from January to August 2015 as naira proceeds.