- On September 1, the NNPC had admitted to owing the sum of $6 billion to suppliers of petrol, also known as premium motor spirit (PMS).
Wale Edun, finance minister and economy coordinator, has revealed that NNPC Limited has begun process of settling its $6 billion supplier debt.
Edun addressed investors in Washington DC on Wednesday during the IMF and World Bank’s 2024 annual meetings.
Discussing supply arrears, Edun assured NNPC would clear debts soon, clarifying the petrol subsidy removal announced earlier.
“In terms of NNPC, reality is subsidy removal on May 29, 2023, didn’t eliminate it, but shifted to foreign exchange subsidy, borne mainly by NNPC,” Edun said.
“I think NNPC has found a route to paying down debts and will start soon. They’ve commenced paying suppliers.”
On September 1, NNPC admitted owing $6 billion to petrol suppliers.
Olufemi Soneye, NNPC’s Chief Corporate Communications Officer, cited financial strain from petrol supply costs affecting PMS sustainability.
Edun explained the Central Bank’s willing buyer, willing seller market-based pricing for FX and petroleum products.
“The same applies to petrol, diesel, kerosene and jet fuel,” Edun said.
“We now have local refiners buying crude in naira, refining and selling in naira.”
“This marks the first time in 40 years we’ve achieved market-based petrol pricing.”
“Maintaining market pricing will redirect wasteful expenditures, benefiting Nigeria’s economy.”
To deregulate the downstream sector, the federal government launched the direct purchase model on October 11.
Oil marketers can now buy petroleum products directly from Dangote refinery and local producers, bypassing NNPC.