Business

Petrol subsidy stays till June 2022, says minister •N714b paid in seven months

Published

3 years ago

October 27, 2021

Finance, Budget and National Planning Minister Mrs. Zainab Ahmed

There is no plan to end petrol subsidy for now, the Federal Government said yesterday.

Finance, Budget and National Planning Minister Mrs. Zainab Ahmed said provision has been made for the first six months of next year.

She explained that subsidy payment would stop since complete deregulation of the downstream oil and gas sector will start by July 2022.

The minister stated this at a panel session during the 27th Nigerian Economic Summit (NES#27) in Abuja on Monday.

“In the 2022 budget, we only factored in subsidy for the first half of the year; the second half of the year, we are looking at complete deregulation of the sector, saving foreign exchange and potentially earning more from the oil and gas industry, “ Ahmed said.

Although The Nation had reported that no specific provision was made for subsidy payment in the 2022 budget, a top official of the Finance Ministry, said yesterday that the government was banking on extra-budgetary expenses for the purpose.

“Money to fund petrol subsidy will be drawn from a special account domiciled in the Office of the Accountant General of the Federation (OAGF),” the official explained.

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At the event, Prof. Doyin Salami, chairman of the Economic Advisory Council (EAC), described subsidy payment as illegal. Also, Director-General, Debt Management Office(DMO) Patience Oniha told participants that the government has so far issued N1.5 trillion promissory notes to its creditors.

Salami said he had argued for a long time that subsidy needed to go since the Petroleum Industry Act (PIA) made the payment illegal.

The EAC chairman said: “ The PIA essentially makes illegal to pay petrol subsidy. Yes, there is a period where NNPC(Nigerian National Petroleum Corporation) and the new regulatory agencies must calibrate themselves, but at the end of this period – and I think it is about six months, which explains why the minister has said for the first half of the year, there is a provision.

“My view will be if we could get it done sooner than that, it will be excellent. It releases money. The key point is simply this: we are now, any which way, at the tail end of that conversation, except if we choose not to obey the law. My sense is we will obey the law and subsidy will be gone.”

NNPC, the only importer of petrol, deducts subsidy payment from oil and gas proceeds due to the federal, state, and local governments since no provision was made for it in the 2021 budget.

In seven months, petrol subsidy payments gulped N714 billion.

Explaining the N1.5 trillion promissory notes issued by government creditors, Oniha, added: “We can’t talk about debt alone, we must also talk about revenues.”

The DMO boss explained that “when you borrow and invest monies wisely, it will enhance growth and development”

She added that that was “why we(government) issued promissory notes of N1.5 trillion approved by the National Assembly. “

Oniha said: “We can’t talk about debt alone; we must also talk about revenues. When you borrow and invest these monies wisely, it will enhance growth and development which is why we have issued promissory notes of N1.5 trillion approved by the National Assembly.”

She noted that “to include any debt data in the country’s debt stock, it has to be approved by the National Assembly and the Federal Executive Council,

The DMO chief admitted that Nigeria’s debt service to revenue is high and should not be at the level that it is. She therefore called for multiple ways of growing revenue to invest in the future.

She said Nigeria’s Debt Management Strategy “provides a framework on how to undertake borrowings in the country”.

Another panelist, Taiwo Oyedele, suggested that “if we want to optimise, we have to harmonise multiple taxation and multiplicity of collection agencies to ensure that revenue collection mechanisms are boosted.”

Oyedele, who is Africa Tax lead at the PwC, disagreed with some policies of the government which allows about 60 MDAs(Ministries, Departments, and Agencies) to generate revenue.

According to him, “it is impossible for that number of agencies to be involved in revenue collection. They should concentrate on providing services.”

The Nation

Related Topics:June Minister Petrol subsidy

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Aviation

Disaster averted as bird strike hits Abuja-Lagos Air Peace flight

Published

13 hours ago

November 14, 2024

Trends Admin

Disaster averted as bird strike hits Abuja-Lagos Air Peace flight

An Abuja-Lagos flight was on Thursday aborted following a bird strike on the airplane belonging to Air Peace, forcing the authorities to ground the aircraft.

The bird strike experienced in the early hours reportedly prompted a ramp return to ensure the safety of passengers onboard.

All the passengers quickly disembarked and were calmed down before they were moved into another plane for the one-hour journey.

A bird strike is a collision between a bird and an aircraft, or other airborne animal, while the aircraft is in flight, taking off, or landing. And it can be a significant threat to aircraft safety.

Air Peace in a statement by its Head of Corporate Communications, Ejike Ndiulo, said the bird strike occurred at 6:30am, and all passengers disembarked normally.

The statement read, “We wish to inform our esteemed passengers that our Abuja- Lagos 06:30 flight experienced a bird strike before take-off, prompting a ramp return as a safety measure. All passengers disembarked normally.

“We have deployed a replacement aircraft for the affected flight in order to minimize disruptions, thus ensuring that passengers continue their journeys promptly.

“We appeal for the understanding of our valued passengers impacted by this development, as well as those on other flights that may experience delays.

“At Air Peace, we are committed to providing safe, comfortable, and reliable air travel for all our passengers.”

Business

NNPC achieves 1.8mbpd crude oil production

Published

13 hours ago

November 14, 2024

Trends Admin

NNPC achieves 1.8mbpd crude oil production

The Nigerian National Petroleum Company Limited (NNPC Ltd) and its partners have revved up crude oil and gas production to 1.8million barrels per day (mbpd) and 7.4standard cubic feet per day (scfd).

The company which announced this at a press briefing said the feat was achieved in compliance with the mandate of President Bola Ahmed Tinubu.

Speaking on the development, the Group Chief Executive Officer, Mr. Mele Kyari, congratulated the Production War Room Team that anchored the production recovery process.

“The team has done a great job in driving this project of not just production recovery but also escalating production to expected levels that are in the short and long terms acceptable to our shareholders based on the mandates that we
have from the President, the Honourable Minister, and the Board,” Kyari explained.

Giving details of the efforts of the Production War Room, the Chief War Room Coordinator and Senior Business Adviser to the Group Chief Executive Officer, Mr. Lawal Musa, disclosed that the feat was achieved through the collaborative efforts of Joint Venture and Production Sharing Contract partners, the Office of the National Security Adviser, as well as government and private security agencies.

NNPC achieves 1.8mbpd crude oil production

Business

FG gets fresh $134m loan from AfDB for agric projects

Published

13 hours ago

November 14, 2024

Trends Admin

FG gets fresh $134m loan from AfDB for agric projects

The Federal Government has secured a loan facility of $134million from the African Development Bank (AfDB) to help farmers boost seeds and grain production in the country.

This is contained in a statement issued by Anthonia Eremah, Chief Information Officer, Ministry of Agriculture and Food Security, on Thursday, in Abuja.

Minister of Agriculture and Food Security, Sen. Abubakar Kyari, made his know at the unveiling of the 2024/2025 National Dry Season Farming in Calabar, Cross River State capital.

Kyari explained that with the re-introduction of the national dry season farming to boost year-round agricultural production, the loan would be handy and guarantee national food security in the country.

The minister said the initiative is under the National Agricultural Growth Support Scheme-Agro Pocket (NAGS-AP) Project.

He said the federal government had declared an emergency on food production to enable all Nigerians to get easy access to quality and nutritional food at affordable rates.

Kyari also said government wants to use the agricultural sector for national economic revival through increase in production of some staple food crops such as wheat, rice, maize, sorghum, soybean, and cassava during both dry and wet season farming.

He added that 107,429 wheat farmers were supported under phase 1 of the 2023/2024 dry season, and 43,997 rice farmers under the second phase of the 2023/2024 dry season.