Deficit Reduction at the NNPC

Oil & Gas
Proshare - Facebook Proshare - Twitter Proshare - Linked In Proshare - WhatsApp

Friday, July 08 2016 9:40AM /FBNQuest Research

The NNPC’s accounts for April show a group operating deficit of N19.4bn (US$69m), compared with N18.9bn in March. Both monthly revenue and expenditure were the lowest over the previous 12 months.

Revenue from the Nigerian Petroleum Development Company amounted to just N8.4bn, reflecting the sabotage of the Forcados export pipeline. The corporation estimates the shut-in at 380,000 b/d. The report also notes a decline in revenue at the Pipeline and Products Marketing Company, the supplier of last resort.

Over the 12 months to April, crude oil and gas accruals totaled US$3.78bn. These export proceeds were paid in full to meet cash call obligations to the NNPC’s joint-venture partners. This left nothing for the federation account.

The proceeds fell short of the obligations. The 2015 and 2016 federal budgets projected average monthly payments of US$620m and US$710m respectively. The report puts the current arrears at more than US$5bn, industry sources rather higher. The corporation is in talks with its partners about new funding arrangements.

Total group spending decreased by N5bn to N127bn in April despite a pick-up in restructuring costs at central headquarters (CHQ).

The corporation has trimmed its operational deficit from N267bn in 2015 to N66bn in January-April. Its progress has been slowed, however, by pipeline sabotage, the slide in the oil price and the costs of its reorganisation.

Related News

1.       Nigeria Attracts Infrastructure Investment in Oil & Gas;Signs MOUs with Chinese firms worth $80bn

2.      55% of Total Domestic Crude Oil supply in April 2016 was via Direct Sales Direct Purchase Agreement

3.      NEITI Publishes 2013 Oil & Gas Audit Report

4.      NNPC’s February Accounts Shows Operating Deficit of N24.2bn

5.      Many signs of life at the NNPC

6.      An operating deficit in 2015 for the NNPC – Feb 29, 2016

7.      President Buhari Approves New Board For NEITI – Feb 24, 2016

8.     NBS Publishes Monthly Imported Petroleum Products Report from 2010 to Sep 2015 – Jan 29, 2016

9.      Signs of life at the NNPC refineries as daily output of PMS reach 6.7 mln litres – Jan 08, 2016

10.  A NNPC plan to tidy up its finances – Nov 11, 2015

11.   Unprecedented data release by the NNPC – Oct 22, 2015

12.  Some news to savour from the NNPC – Oct 15, 2015  

Related News