The Nigerian National Petroleum Company Limited (NNPC Ltd) says the decision to remove subsidy on Premium Motor Spirit (PMS) known as fuel by President Bola Tinubu is a welcome development.
Mele Kyari, Group Chief Executive Officer (GCEO), NNPC Ltd. made this known at the NNPC Ltd. Towers in Abuja while briefing the newsmen late Monday night after the pronouncement by the President.
Tinubu, at his inauguration as the President of the Federal Republic of Nigeria on Monday said subsidy regime will end with the commencement of his administration.
Kyari, while addressing the newsmen said the removal of the subsidy which had been a burden on NNPC’s cash flow would free up funds to enable optimal operations in the company.
“Subsidy has been a major challenge for NNPC’s continuous operations, we believe that this will free up resources to enable us continue to do great work and function as a commercial entity, we welcome this development,’’ he said.
Reacting to queues and scarcity already being experienced, the GCO assured Nigerians of sufficient supply of products particularly the PMS, adding that the company has over 30 days of PMS storage and supply.
“There is no reason to panic, we understand that people will be scared of potential changes in price of petrol, that is not enough for people to rush to buy more than they need,’’ he added.
He however appealed to Nigerians not to be scared or indulge in panic buying.
He added that the company as the supplier of last resort as mandated by the Petroleum Industry Act (PIA) would continue to ensure availability of PMS and other petroleum products.
According to him, the NNPC Ltd. is also monitoring all its distribution networks to ensure compliance.
“The NNPC Ltd. is in discussion with the Nigeria Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) to develop framework of the implementation of the removal of the PMS subsidy as announced by the president.
Former President Muhammadu Buhari set June 2023 as the date for the removal of fuel subsidy.
The federal government had explained that if it continues to service the subsidy, the country will spend N6.4 trillion annually.
Buhari’s new deadline for removing fuel subsidy will be a month after he hands over to his successor in May 2023, leaving the new leader to deal with any backlash and commotion that may follow the decision.
The government said the Medium Term Expenditure Framework was that if the nation holds on to fuel subsidy as it is designed now, we will be incurring from January to December a subsidy cost of N6.4 trillion.
