Why We Pay ‘Subsidy’ Without National Assembly’s Permission – NNPC

The Nigeria National Petroleum Corporation, NNPC, has explained why it pays ‘subsidy’ on petrol without appropriation from the National Assembly.

Managing Director of the Petroleum Products Marketing Company, PPMC, an NNPC arm, Umar Ajiya, said the NNPC Act is a law on its own which the corporation implements with or without the National Assembly.

Ajiya told Channels Television on Friday that the NNPC has the right to run its finances independently.

He admitted that the corporation has been paying N26 due to differentials in land landing cost and approved selling price but declined to tag it subsidy.

“For us, it’s not a question of subsidy, we don’t know about subsidy. It was not budgeted for but the act establishing us, the National Assembly knows clearly that in that same act, there is a provision that we can run our operation and recover our cost fully.

“There is a difference between the landing cost and the price we are selling but what we are saying is that is part of our core structure.

“The NNPC act is a law on itself and the National Assembly is the one responsible for enacting laws, so, if there is any remedy or solution; as one of the senators, the issue is look into the Act establishing these entities; NNPC,CBN etc.”

The PPMC boss attributed the recent fuel queues to poor transportation system in the country, which has hampered smooth circulation of products, and dubious purchase in major cities.

He said, “For the last one week, there is no blessed day that trucks do not fall off the road between Jebba and Mokwa and this is the link way where these products are brought from the depot especially from the south to the north, especially Abuja.

“We had to mobilise to do palliative repairs and pull off the trucks to ensure that trucks move. On top of that, the channels from which we transport these products from the ships offshore Lagos to Warri was blocked by another vessel. We equally have to mobilise together with the owner of the vessel to try to remove that ship. That channel has not been dredged for a long time.

“Two, there is an issue of capacity to regulate effectively the price cap. DPR is trying its best but what is happening is that in the major cities of this country where you have the major marketers, and also the mega stations of NNPC, people get the fuel for N145 but when you go to the outskirts of the city, it is sold beyond that price and as such, motorists come into the city early morning to queue up and late in the evening, refuel their gas and go back. It reached a stage that the taxi drivers have now found a very lucrative job of buying the fuel in the city and going back to the outskirts to sell at high price.”

He was, however, quick to add that these problems were inherited from previous administrations.

“These are consequences of inherited state of infrastructure we are living with. The administration also inherited an empty treasury. So, we couldn’t overnight repair all these roads.”