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Oil revenue dropped by N226.38bn in January – Minister

Category: Oil Sector

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Oil revenue dropped by N226.38bn in January – Minister

February 23, 2012

The Federal Government has recorded a significant drop of N226.38bn in oil revenue for the month of January, the Minister of Finance, Dr. Yerima Ngama, has said.

The minister, who disclosed this on Wednesday while addressing journalists shortly after the Federation Accounts Allocation Committee meeting, said the revenue dipped from N892.70bn in December 2011 to N666.32bn in January.

He said the huge decline in revenue was largely due to production hiccups experienced in the major oil production centres.

For example, he said there was a drop in crude oil lifting as a result of production shutdown at the Bonga Terminal, as well as drop in production at the Qua Iboe Terminal, in addition to downward review of estimates by oil producing companies.

Ngama also said the one-week strike embarked upon by organised labour to protest the removal of subsidy on petrol also contributed to the huge decline.

“The gross revenue of N666.32bn received for the month was lower than the N892.70bn a month earlier. This was due to a drop in crude oil lifting as a result of the production shutdown at the Bonga Terminal,” the minister said.

He also said that the Nigerian National Petroleum Corporation still owed the Federation Account N203bn in un-remitted revenue.

The controversial N450bn un-remitted oil proceeds had been a bone of contention between the NNPC and members of FAAC for the past two years.

The corporation had in 2011 refused to remit the amount, claiming that the Federal Government actually owed it unpaid subsidies.

But after much pressure from the committee, the corporation on November 2, 2011 agreed that since it was also being owed by the Federal Government, it would only repay the portion that belonged to the state and local governments, which amounted to N250bn.

But Ngama said that of the N250bn, the corporation had only paid N45.7bn.

“The NNPC has been paying its debt as agreed with FAAC, and as at today, it has paid a total of N45.70bn,” he said.

Explaining the revenue allocations for the month of January, the minister said that N614bn was distributed to the three tiers of government.

The amount represents a decrease of N2bn over the N616.9bn shared in the month of December 2011.

Ngama said N368.18bn was shared as statutory allocation; Value Added Tax accounted for N51.11bn; augmentation, N187.09bn; and monthly refund from NNPC, N7.61bn.

Of the statutory allocation, he said the Federal Government got N173.44bn, representing 52.68 per cent; the 36 states, N87.97bn or 26.72 per cent; while the 774 local government councils got N67.82bn or 20.6 per cent.

In addition, the oil producing states got N38.9bn as 13 per cent derivation.

For VAT allocation, the minister said the Federal Government got N7.66bn or 15 per cent; states, N25.56bn or 50 per cent; and the local governments, N17.89bn or 35 per cent.


Source: Punch

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