The request by the Nigerian National Petroleum Company Limited (NNPCL) to utilize the 2023 dividends owed to the federation for petrol subsidy has been authorized by President Bola Tinubu, as reported by TheCable.
In addition, Tinubu has also given the green light to suspend the payment of 2024 interim dividends to the federation to bolster the oil firm’s cash flow.
According to the report, Tinubu approved the subsidy payment for NNPCL after the company expressed that it had exhausted all efforts to maintain a consistent supply of gasoline in the country.
The strategies included improving oil production by fighting theft and vandalism; debt rescheduling/forward sales; payment deferrals to suppliers and contractors; deferrals of non-critical projects; and debt recovery, amongst others.
“These strategies, the government oil company informed the president have failed to ameliorate the problem, saying going forward, the company would no longer be able to remit funds into the federation Account.”
“President Tinubu has therefore directed the company to use the taxes, royalties, and other funds that are supposed to be remitted to the Federation Account to defray the fuel subsidy cost,” the report said.
The approval was said to be given on June 6, 2024.
