• Oil & Gas - News
  • Updated: September 21, 2023

Fuel Subsidy: How FG Paid N169 Billion In August

Fuel Subsidy: How FG Paid N169 Billion In August

In an unexpected turn of events, new information has revealed how the federal government paid N169.4 billion as subsidy in August despite the announcement and assurances that it is gone for good.

The latest reports indicate that the above sum was paid to keep the fuel price at N620 per litre, suggesting a return to the fuel subsidy.

According to a document by the Federal Account Allocation Committee (FAAC), in August 2023, the Nigerian Liquefied Natural Gas (NLNG) paid $275 million as dividends to Nigeria through NNPC Limited. 

It was also gathered that NNPC Limited used $220 million (N169.4 billion at N770/$) out of the $275 million to pay for the PMS subsidy, allegedly holding back $55 million illegally.

The shocking disclosure is a pointer to the fuel subsidy return, with the report showing that NNPC is now using NLNG dividends to pay the subsidy.

Meanwhile, President Bola Tinubu recently defended his administration's decision to remove the fuel subsidy, adding that it is meant to foster economic growth and investor confidence in the country.

“I removed the costly and corrupt fuel subsidy while also discarding a noxious exchange rate system in my first days in office. Other growth and job-oriented reforms are in the wings.

“I am mindful of the transient hardship that reform can cause. However, it is necessary to go through this phase in order to establish a foundation for durable growth and investment to build the economy our people deserve.

“We welcome partnerships with those who do not mind seeing Nigeria and Africa assume larger roles in the global community.

“The question is not whether Nigeria is open for business. The question is how much of the world is truly open to doing business with Nigeria and Africa in an equal, mutually beneficial manner.

“Direct investment in critical industries, opening their ports to a wider range and larger quantity of African exports and meaningful debt relief are important aspects of the cooperation we seek.

“Second, we must affirm democratic governance as the best guarantor of the sovereign will and well-being of the people. Military coups are wrong, as is any tilted civilian political arrangement that perpetuates injustice.

“The wave crossing parts of Africa does not demonstrate favour towards coups. It is a demand for solutions to perennial problems”, he said at the United Nations General Assembly.

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