By David Iorja & Mbafan Ade (ABUJA) –
President Muhammadu Buhari today in Abuja declared of Profit after Tax of N287 billion (about $697.5million) in Year 2020 by the Nigerian National Petroleum Corporation (NNPC).
Buhari, who doubles as Minister for Petroleum Resources, said the net profit was arrived at following the completion of the statutory Annual Audit exercise for Year 2020.
The declaration of a Net Profit, first time in the 44-year history of the NNPC was in fulfillment of an earlier pledge by the Federal Government to publicly announce the financial position of the establishment.
Presidential spokesman, Femi Adesina quoted Buhari to have said: “The NNPC losses were reduced from N803 Billion in year 2018 to N1.7 billion in year 2019 and the eventual declaration of Net Profit in Year 2020 for the first time in its 44-year history.
“This development is consistent with this administration’s commitment to ensuring prudent management of resources and maximization of value for the Nigerian people from their natural resources.
“I have further directed the Nigerian National Petroleum Corporation to timely publish the Audited Financial statements in line with the requirements of the law and as follow up to our commitment to ensuring transparency and accountability by public institutions.
“I congratulate the Board, Management and Staff of the Corporation and look forward to greater value creation for the Nigerian people.”
President Buhari’s announcement came a day after the Group Managing Director of the NNPC, Mallam Mele Kyari, received accolades from the House of Representatives Committee on Finance for providing detailed explanations on some burning Oil Industry issues at an interactive session on the 2022-2024 Medium Term Expenditure and Revenue Framework (MTERF) and Fiscal Strategy Paper (FSP).
Chairman of the House Committee on Finance, Abiodun James Faleke, had on Wednesday commended Kyari for providing an in-depth explanation and insider perspective on some issues surrounding the operations of the NNPC and the Oil Industry stating: “You have made our day. The committee is better informed based on explanations provided by the GMD.”
Mallam Kyari, in his presentation, had provided a base oil price scenario in the medium term as follows: $57 per barrel for 2022, $61 per barrel for 2023 and $62 per barrel for 2024
He explained that the assumptions were arrived at after a careful appraisal of the three-year historical dated Brent Oil Price average of $59.07 per barrel premised on Platts Spot Prices.
Group General Manager, Group Public Affairs Division of the corporation, Garba Deen Muhammad, quoted Kyari to have informed the lawmakers:
“Price growth is to be moderated by the lingering concerns over COVID-19, increased energy efficiency, switching due to increased utilization of gas and alternatives for electricity generation. These are reflected in the Medium Term Revenue Framework.’’
On the perennial issue of smuggling of petroleum products, Kyari implored the National Assembly to come to the aid of the Corporation in battling the menace, noting that the Corporation, based on the directive of Mr. President, had mobilized some Federal Agencies like the Customs, the Economic and Financial Crimes Commission (EFCC), the Police, Civil Defence Corps and others, to find workable solutions to the menace.
On the propriety of establishing NNPC Retail stations in neigbouring countries to curb the challenge of illegal haulage of petroleum products across the border, Kyari said though the NNPC once considered the option, it had to jettison the idea when it became imperative that the measure would be counterproductive.
He explained that people who are smuggling are not looking for officially priced petroleum products. He further noted that going ahead to establish NNPC Retail stations would not yield the desired result since the people who take products across the border are not interested in selling at the official prevailing prices at approved stations but are interested in under the counter deals.
The NNPC GMD also took time to provide detailed explanation on the Corporation’s equity shareholding interest in Dangote Refinery, noting that the package which was at the instance of NNPC is designed to guarantee national energy security.
He stated that the equity interest was secured after due consideration of the national interest and best possible options.
“We will have right to 20 percent of production from this facility. We structured our equity participation on the basis that the refinery must buy at least 300,000 barrels of crude oil per day of our production. This guarantees our market at a period when every country is struggling to find market for their crude oil’’ he explained.