The Group Managing Director ( GMD) of the Nigeria National Petroleum Corporation ( NNPC) , Mr Maikanti Baru on Thursday revealed that the Coporation is subsidizing per liter of Premium Motor Spirit (PMS) with N40.
He however denied allegation of $3.5 billion dollars in a special account as claimed by the Minority leader, Biodun Olujinmi .
Speaking before Senate adhoc Committee investigating alleged application of $3.5 billion for subsidy, Baru revealed that NNPC is using $1.05billion from dividends of Liquified Natural Gas ( LNG) , to augment daily shortages incurred in the pump price of Premium Motor Spirit ( PMS).
According to him, $1.05bn which is equivalent of N383.2bn taken from LNG dividends is domiciled in a special account with the Central Bank of Nigeria ( CBN) called National Fuel Support Fund ( NFSF) for the purposes of augmenting loses incurred from petrol pump price of N145 per litre as against N185 per litre it supposed to be .
” Based on available parameters from landing to transportation costs, the pump price of PMS supposed to be N185 per litre as against the official price of N145 per litre , indicating shortage of N40 per litre .
” Since subsidy is not appropriated for and pump price not adjusted upwardly, NNPC had no other option than to adjust in line with it’s establishment Act, section 7 sub section 4(b), defray its costs from its revenues”, he said .
