Tinubu Approves NNPC to use 2023 dividends for subsidy

Nigerian President Bola Tinubu has authorized the Nigerian National Petroleum Company Limited (NNPCL) to utilize the 2023 dividends intended for the federation to cover petrol subsidy costs, according to a report by TheCable. This move comes despite Tinubu’s initial announcement to remove fuel subsidies during his inaugural address on May 29, 2023. The decision aims to address NNPCL’s struggles to maintain a stable gasoline supply, despite efforts to improve oil production, restructure debt, and defer payments. The forecasted petrol subsidy expenses from August 2023 to December 2024 total N6.884 trillion, which will impact the company’s ability to remit N3.987 trillion in taxes and royalties to the federation account. The president’s approval, granted on June 6, 2024, also includes suspending the payment of 2024 interim dividends to augment NNPCL’s cash flow. This development raises questions about the government’s consistent denial of subsidy payments, amidst ongoing economic challenges and public demands for subsidy reinstatement.