NNPCL Seeks ₦4.71 Trillion Refund from FG for Fuel Import Exchange Rate Losses

The Nigerian National Petroleum Company Limited (NNPCL) has requested a refund of ₦4.71 trillion from the Federal Government to cover debts arising from the importation of Premium Motor Spirit (PMS) between August 2023 and June 2024.

The claim is described as an “exchange rate differential on PMS and other joint venture taxes,” reflecting the financial burden of currency fluctuations experienced during this period.

This information was disclosed by the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, during the Federation Accounts Allocation Committee meeting in June. The exchange rate differentials result from the disparity between anticipated and actual costs incurred by NNPCL in importing petroleum products.

The government has been subsidizing these fuel imports by covering the difference, despite previous claims of subsidy removal. The situation has also contributed to challenges faced by NNPCL in maintaining a steady supply of PMS to marketers nationwide.

Edun revealed that NNPCL had received presidential authorization to operate with the “Weighted Average Rate” from October 2023 to March 2024 but was advised to seek further approval from the National Economic Council to cover the entire period. The exchange rate used for these imports initially set at ₦650 to $1, surged to ₦1,200 due to the naira’s devaluation, resulting in a significant exchange difference.