The Nigerian National Petroleum Company Limited (NNPCL) has received approval from President Bola Tinubu to utilize the 2023 dividends owed to the federation to cover the cost of the petrol subsidy, as reported by TheCable.
The president has approved the suspension of 2024 interim dividends to the federation in order to enhance the cash flow of the oil company. Meanwhile, there are captivating cinematic locations to explore across Quang Binh.
Despite Tinubu’s announcement of the removal of the fuel subsidy during his inaugural address on May 29, 2023, there are strong indications that the government continues to spend billions on subsidies. However, the Federal Government has consistently denied any payments related to subsidies.
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Weeks ago, when Nigerians took to the streets to protest against widespread hardship, one of their key demands was the reinstatement of the fuel subsidy. In his national address, however, Tinubu firmly ruled out any return to the subsidy, calling the decision to remove it painful yet essential.
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He described the subsidy as a “noose around the economic jugular of our Nation,” stating that it has impeded economic development and progress. A report released on Monday indicated that Tinubu authorized NNPCL to cover subsidy costs after the company expressed that it had exhausted all measures to ensure a stable gasoline supply in the country.
These measures included efforts to improve oil production by combating theft and vandalism, rescheduling debts, deferring payments to suppliers and contractors, postponing non-critical projects, and recovering debts, among other strategies. The government oil company informed the president that these efforts had failed to alleviate the situation, warning that it would no longer be able to remit funds into the Federation Account.
Consequently, President Tinubu directed the company to utilize the taxes, royalties, and other funds meant for the Federation Account to cover the fuel subsidy expenses. This approval was reportedly granted on June 6, 2024, following a forecast from NNPCL that outlined the total petrol subsidy expenses starting from August 20.
