Subsidy: Customs boss doubts NNPC claim of 98 million litres/day petrol consumption

The Comptroller-General of Nigeria Customs Service, Col. Hameed Ali (retd.), has expressed doubt over a claim by the Nigerian National Petroleum Company Limited (formerly Nigerian National Petroleum Corporation)  that the country consumes 98 million litres of petrol daily on which it has to spend N6.34tn as subsidy annually.

He maintained that the corporation could not provide unassailable evidence for the 98 million litres/day consumption of petrol, noting that the nation’s oil company was supplying an excess of 38 million litres of the PMS daily.

The committee had asked Ali about the like deficit of between N11tn and 12tn in the 2023 budget as proposed in the 2023-2025 MTEF/FSP.

The Federal Government is proposing a budget of N19.76tn for 2023, with a deficit of between N11.30tn and N12.41tn in the 2023 fiscal year.

Minister of Finance, Budget and National Planning, Zainab Ahmed, who appeared before the committee earlier on Monday, said the government might be unable to provide for treasury-funded capital projects next year, especially due to dwindling revenue and annual payment of N6.34tn subsidy on petrol.

READ ALSO:

• Antony signs for Man Utd and becomes the fourth most expensive signing in Premier League history
• Auto assemblers raise concern over N16.91bn NAC fund whereabouts
• W’Bank asks Nigeria to unify exchange rates, stop fuel subsidy

However, Ali faulted the NNPC on its subsidy claims, saying, “I remember that last year we spoke about this. Unfortunately, this year, we are talking about subsidy again. The over N11tn we are going to take as debt, more than half of it is going for subsidy. The issue is not about smuggling of petroleum products. I have always argue this with NNPC.”

Ali also said, “If we are consuming 60 million litres of PMS per day, by their own computation, why would you allow the release of 98 million litres per day? If you know this is our consumption, why would you allow that release? Scientifically, you cannot tell me that if I fill my tank today, tomorrow, I will fill the same tank with the same quantity of fuel. If I am operating a fuel station today and I go to Minna depot, lift petrol and take it to Kaduna, I may get to Kaduna in the evening and offload that fuel. There is no way I would have sold off that petrol immediately to warrant another load. So, how did you get to 60 million litre per day? That is my problem.

“The issue of smuggling: if you release 98 million litre in actual and 60 million litres is used, the balance should be 38 million litres. How many trucks will carry 38 million litres every day? Which road are they following and where are they carrying this thing to?”

The Customs CG however told the committee that the Service would meet its revenue projection of N2.272tn for 2022, N2.873tn for 2023, N3.540tn for 2024 and N3.752tn for 2025.

The committee’s Deputy Chairman, Saidu Abdullahi, who presided over the hearing, decried that funds under the subsidy scheme, which should have been used to finance capital projects, were being diverted into private pockets.