President Bola Tinubu has approved a request by the Nigerian National Petroleum Company (NNPC) Limited to utilise the 2023 final dividends due to the federation to pay for petrol subsidy.
The president reportedly approved a halt on the payment of 2024 interim dividends to the federation to help boost NNPC’s cash flow.
The NNPC informed the president that it is currently unable to pay taxes and royalties into the federation account due to subsidy payments, referring to this as a “subsidy shortfall/FX differential”.
The report, based on a forecast from NNPC and obtained by the Businessday newspaper, indicates that the total petrol subsidy expenses from August 2023 to December 2024 will amount to N6.884 trillion. This will leave the company unable to remit N3.987 trillion in taxes and royalties to the federation account.
The precise number of dividends that would be withheld or put on hold could not be confirmed at the time of filing this report.
Source: Sahara Reporters
