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Tag: Maikanti Baru

  • Baru commissions $60m gas plant in Delta

    The Nigerian National Petroleum Corporation (NNPC), Group Managing Director Dr. Maikanti Baru on Thursday commissioned a $60m Egbeoma Gas Processing Plant in Ebedei Community, Ukwuani Local Government of Delta State.

    He said the corporation was committed to pursuing the Federal Government’s aspiration of aggressively deploying the nation’s vast gas resources for economic growth.

    The NNPC Group General Manager, Group Public Affairs Division Ndu Ughamadu disclosed this in a statement at Abuja.

    “NNPC is committed to the Federal Government’s aspirations as expressed in the gas policy, environmental policy and domestic gas utilization policy,” Dr. Baru stated.

    Some of the targets under the various government policies, Dr. Baru observed, include the effective monetization of the nation’s vast gas resources for sustainable economic growth and a complete end to gas flaring.

    In particular, GMD said the corporation was pursuing aggressive growth in domestic gas supply capacity from the current 1.7bscfd to 5bscfd in the medium term, a growth which he explained, would come from the seven (7) critical gas development projects.

    According to him, aside the gas supply growth, the NNPC was equally committed to the expansion of gas pipeline infrastructure network system.

    “This expansion includes the Obiafu-Obrikom-Oben (OB3) gas pipeline which is less than 5km to Egbeoma Gas Plant and can serve as a major evacuation artery of the dry gas produced from the plant to the market,” he added.                                                                                                                                                                          While congratulating PNG Gas Ltd, operators of the Egbeoma Gas Plant, Baru noted that the development fitted squarely into the Federal Government’s gas aspiration of using gas as an enabler for energy independence, industrial development, commerce and environmental and social sustainability.

    Read Also: Baru directs NNPC retail to secure 30% marktet share

    He also described the achievement as a “no mean feat”, adding that the conceptualization and actualization of the gas plant project dream had reinforced NNPC’s confidence in the potentials of Nigerian indigenous companies.

    The GMD urged operators whose assets are close to the plant and the OB3 pipeline to seize the opportunity by collaborating with PNG Gas Limited to supply gas to maximize the plant’s capacity, access and commercialize all existing flares and further develop the significant gas reserves of 1Tcf of gas in the area.

    “I see this initiative as the beginning of an end to the last mile of gas flaring in Nigeria. This plant is a hallmark of Nigerian engineering prowess and local content capacity,” he added.

    Promoter of the Egbeoma Gas Plant project, Engr. Charles Osezua, said the plant represented the success story of Nigerian engineering.

    “Our dream is to help realize the Federal Government’s drive of building a gas hub in this area by processing 150mmscfd of gas which will not only generate power but also support the growth of the nation’s economy,” Osezua stated.

    He said as an industry leader, NNPC had a major role to play in galvanizing and bringing together the nation’s gas producers with a view to creating a gas hub in the country.

    He noted that since inception in 2016, the plant had been running at 97% of installed capacity with a stellar safety record of about 1.5million man hours of operation without loss time injury (LTI).

    The PNG Gas Limited is the owner and operator of Egbeoma Gas Plant which processes 30 million standard cubic feet of wet gas daily.

    The plant is also the only onshore third-party gas extraction and fractionation plant of its kind in Nigeria and a mascot of the new gas revolution.

  • NNPC, police renew synergy on anti-pipeline vandalism

    The Nigerian National Petroleum Corporation (NNPC) and the Nigeria Police have pledged to work together in a renewed drive to combat the perennial menace of oil theft and pipeline vandalism across the country.

    Group General Manager, Group Public Affairs Division of the NNPC, Mr. Ndu Ughamadu, said this in a statement he issued in Abuja.

    The NNPC spokesman noted that the decision to reinvigorate the push against oil pipeline marauders was reached at the meeting between the Group Managing Director of the corporation, Dr. Maikanti Baru and the Acting Inspector General of Police, Mr. Abubakar Mohammed Adamu at the NNPC Towers in Abuja.

    The release said the renewed cooperation would consolidate the prevailing cordial relations between both entities in tackling the menace which has manifested in losses of millions of litres of petroleum products.

    Receiving the Police boss at the NNPC Towers, Dr. Baru congratulated the Acting IGP on his appointment, noting that it was gratifying for him to have chosen the NNPC Towers as destination of his first courtesy visit since assumption of office.

    The NNPC GMD assured that the corporation would work assiduously with the new IGP in pursuit of the mutual mandate of ensuring protection of the nation’s vast oil and gas assets across the country.

    Dr. Baru seized the opportunity to commend IGP Adamu for the police’s quick response to the recent case of suspected collusion between some policemen and oil pipeline vandals in the Arepo axis, saying it was indicative of the determined commitment of the Police leadership to squelch the ugly menace.

    Read Also: Nigeria’s refineries not too old – NNPC

    In his response, IGP Adamu said that as the foremost provider of the means of sustenance of the Nigerian economy, it was natural for the police to have keen interest in the security and protection of NNPC’s vital oil pipelines and sundry facilities across Nigeria.

    He pledged the commitment of the police force under his watch to seek fresh areas and strategies to strengthen the existing security cooperation between the NNPC and the Police.

  • Abide by rules, FG tells oil sector operators

    The Nigerian National Petroleum Corporation (NNPC) and the Department of Petroleum Resources (DPR) on Thursday charged operators in the oil sector to play by stipulated regulations.

    According to them, an industry player’s simple mistake could finish the entire business in the value chain.

    Specifically, the corporation’s Group Managing Director, Maikanti Baru, noted non-compliance to regulations by operators in the sector was the biggest challenge confronting the industry currently in Nigeria.

    The DPR said it allowed illegal stations and gas plants three weeks of grace to regular isle their facilities or face justice.

    Baru, who was represented by a Group Executive Director of the NNPC, Henry Ikem-Obih, spoke at the DPR Annual General Stakeholders Meeting in Abuja.

    Read Also: INEC signs MOU with transport unions on improved logistics

    He said: “We all remember that over the years we’ve learnt from a lot of very regrettable mistakes that led to incidents that transformed the way we do business in this industry.

    “It is important that we always remember that one mistake in the oil and gas industry is sufficient to wipe out the entire business. It is as bad as an aircraft crash.”

    Continuing, he said: “As operators, we have a responsibility to support the efforts of agencies like DPR, PPPRA (Petroleum Products Pricing Regulatory Agency), PEF (Petroleum Equalisation Fund) who daily drive compliance in the industry.”

    The NNPC boss also stated it was important for regulators to always enforce regulations, because without enforcement they will never achieve full compliance.

    Abuja Zonal Operations Controller for DPR, Abdul Abba, said the gathering was meant to bring together major players in the downstream oil and gas sector to review 2018 operational challenges and set out new plan for 2019.

    He noted: “We have seen where lack of compliance to the statutory regulations with respect to depots, filling stations and LPG outlets has led to huge losses in investment, lives and degradation of environment.”

    Abba also stated that the agency had taken measures to ensure that illegal retail outlets were regularised.

  • Baru directs NNPC retail to secure 30% marktet share

    The Group Managing Director of the Nigerian National Petroleum Corporation, Dr. Maikanti Baru, has charged the Corporation Downstream company, NNPC Retail, to increase its current 14 per cent market share to 30 per cent by 2020.

    Speaking yesterday  in Abuja during the first Triennial Delegates Conference of the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN), NNPC Retail Branch, Dr. Baru stated that the charge was an assignment that must be accomplished.

    A release by NNPC Group General Manager, Public Affairs, Mr. Ndu Ughamadu, said the NNPC Group Managing Director, Dr. Baru, disclosed at the event that the NNPC Management would soon expand the operations of NNPC Retail Limited.

    Baru stated that NNPC was determined to ensure that the prevailing availability of petroleum products across the country was sustained as arrangements have reached advanced stage to acquire more landed property in Abuja and across the states to build more NNPC retail outlets.

    Speaking as Chairman of the occasion, Dr. Jackson Gaius-Obaseki, who is a former Group Managing Director of NNPC, described the National Oil Company as an accountable and transparent going concern, saying nothing should deter it from sustaining its core values.

    The former NNPC GMD stated that the current Management of the corporation deserved commendation for public accountability, pitched against its periodic and prompt reporting of the company’s operations and financial transactions.

    Dr. Gaius-Obaseki, who is also the Chairman of Brass LNG, listed the NNPC core values to include: transparency, integrity and accountability which he explained must be reflected in all the company’s dealings with its stakeholders across the Industry value chain.

    “The current NNPC Top Management led by Dr. Maikanti Baru, must be commended for updating the books of NNPC business units. This is reflective of what used to be. This must be sustained as NNPC business performance should be reported as stipulated in enabling laws”, he said.

    Dr. Gaius-Obaseki stated that the decision to establish the NNPC Retail in 2002 had yielded result with the NNPC Mega stations across the country servicing the petroleum needs of the people, noting that unlike the situation in the past, Nigerians now enjoy fuel availability through the effort of the NNPC Retail Limited.

    He charged the union to be focused in their relationship with management to enable both parties work efficiently for the benefit of Nigerians.

    Read Also: Baru hails oil workers for stopping planned strike

    “Unionism must move away from strikes and protest to developmental focus.  We must move away from being a combative group as a union but be forward looking and join management in the development of business,” he stated.

    In his presentation entitled: “NNPC Retail Limited: Yesterday, Today and Tomorrow”, guest speaker, Mr. Adeyemi Adetunji, Managing Director of NNPC Retail Limited, said the company was moving from a cost centre to profit making entity.

    Mr. Adetunji assured the Group Managing Director of NNPC that his company would hit the 30 per cent market share target set by corporation’s helmsman.

    In the same vein, PENGASSAN President, Comrade Francis Johnson assured that union members will be encouraged to assist the NNPC Retail management in achieving its target, pointing out that “the NNPC Retail has continued to serve as a vehicle of intervention in the market during periods of emergency and avoidable supply interruptions”.

    PENGASSAN NNPC Retail branch chairman, Comrade Baba Shetimah Kukawa, thanked NNPC Retail Management for providing the enabling environment for the union to flourish, pledging the continuous support of the group to the Company.

    He appreciated the GMD and other NNPC top management for their support and assured that NNPC Retail under his watch would continue to work hard towards delivering on the mandates.

  • Senate: $1.05b NLNG dividend not missing

    The Chairman of the Senate Committee on Gas, Senator Bassey Albert, on Thursday in Abuja, clarified that the ongoing investigation of the application of $1.05billion Nigeria Liquefied Natural Gas (NLNG) dividend to support the importation of petroleum products into the country has nothing to do with any missing funds since no such money was missing in the first place.

    Senator Albert, who doubles as the Chairman of the Senate Committee on the Application of the NLNG Dividend, explained that the clarification became necessary due to sensational and misleading reports in some sections of the media.

    The Group General Manager, Group Public Affairs Division, Mr. Ndu Ughamadryas disclosed this in a statement.

    According to him, the lawmaker said the mandate of the Committee was to determine the instrument under which NNPC relied upon to affect the said withdrawal and subsequent application of the NLNG dividend to meet pressing national demand for fuel supply, noting that the Committee relies on NNPC to provide informed perspective on the issues.

    Read Also: Osinbajo to chair extended NEC meeting Friday

    The Senate Committee Chairman emphasized that the engagement with NNPC was to understand the rudiments of the account flow and also to discover how the Committee, working in harmony with NNPC, could make the NLNG dividend more effective and beneficial to the nation.

    Responding, Mr. Isiaka Abdulrazaq, Chief Financial Officer (CFO) of NNPC, who represented the corporation’s Group Managing Director, Dr. Maikanti Baru, pledged the willingness of the corporation to support the Committee in its assignment, saying that relevant documents have been supplied to the panel to enable it determine the veracity or otherwise of NNPC’s .

  • NNPC records N32b trading surplus in 11 months

    The Managing Director of the Petroleum Products Marketing Company Limited (PPMC), Mr. Umar Ajiya, disclosed that the company has returned to profitability with a trading surplus of N32bn between January and November 2018.

     He made this known while the House of Representatives Committee on Petroleum (Downstream), was in the Nigerian National Petroleum Corporation (NNPC) towers, Abuja for an oversight function.  

    The other downstream subsidiaries that made presentations were NNPC Retail Limited, Nigerian Pipelines and Storage Company (NPSC) and NNPC Shipping.

    The PPMC boss also stated that as part of the zero-scarcity strategy, the company has over 170 million liters of PMS in stock at some NNPC Depots across the country following their successful rehabilitation along with connecting pipelines to forestall dependence on private sector depots. 

     NNPC Group General Manager, Group Public Affairs Division, Mr. Ndu Ughamadu disclosed this in a statement on Wednesday. 

    The Nigerian National Assembly, said the spokesman,  commended the corporation on the strategies deployed so far to make petroleum products available to Nigerians throughout the end of year festivities and beyond.

    Chairman of the House of Representatives’ Committee on Petroleum (Downstream), Hon. Joseph Akinlaja, gave the commendation during an oversight visit .

    The lawmaker expressed confidence that the elaborate measures put in place by the corporation to avert fuel supply shortage would be successful this year going by the painstaking efforts that went into the planning and execution of the zero-fuel scarcity strategy. 

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    “We are impressed by the presentation and we are sure there will be no war room here again because of products scarcity, you have done very well and I’m happy that Nigerians are going to travel effortlessly at this period of the year”, Hon. Akinlaja enthused.

    On the threat by major, independent petroleum products marketers to ground the sector due to unpaid subsidy arrears, the Committee Chairman appealed to the Federal Government to do everything within its powers to pay up the arrears to forestall any crisis.

    Speaking further on the need to support NNPC to sustain petroleum products supply, Hon. Akinlaja said the corporation was overburdened and “because of that, when it runs into hiccups, somebody will say their operations are opaque. Let’s avoid fuel scarcity by supporting NNPC”.

    The Committee also expressed satisfaction with the improvement on the integrity of the pipelines and urged NNPC to expedite action on the remaining ones, especially those linking the Ore Depot from Benin City and to the Ibadan Depot.

    In his presentation to the Committee, Group Managing Director of NNPC, Dr. Maikanti Baru, reassured Nigerians of the corporation’s preparedness to ensure zero-scarcity of petroleum products during the upcoming festive season and beyond.

    The GMD who was represented by NNPC Chief Operating Officer, Downstream, Mr. Henry Ikem Obih, lauded the Committee for its support during the last fuel supply hiccups that occurred in the country from November 2017 to the early part of this year.

    He disclosed that adequate measures have been deployed to avert any form of supply challenge, stressing that even if NNPC were to stop importing fuel as from today, there was enough stock of Premium Motor Spirit (PMS) in the country to last for 45 days.

  • NNPC seeks new funding options for operators

    The Nigeria National Petroleum Corporation (NNPC)  says it is devising new ways to attract more funding for operators in Nigeria’s oil and gas industry to launch them into a new phase of exploration.

    The operators have been grappling with funding challenges which has cut down investment in oil exploration.

    Dr Maikanti Baru, the Group Managing Director of NNPC, said the corporation believed that attracting fresh funds to the industry would enable the country to achieve its target of raising reserves to 40 billion barrels in 2020.

    Baru, who spoke at the 36th Nigerian Association of Petroleum Explorationists (NAPE) in Lagos, said that Nigeria had already set achievable target of 40 billion barrels oil reserves and three million barrels a day production by 2020.

    Baru was represented by Dr Victor Adeniran, the Chief Operating Officer (COO) of NNPC Ventures.

    He said the industry required special fund for hydrocarbon exploration to fully achieve its potential.

    “Currently, as a physical incentive, all exploration cost within the industry is expensed, this is a laudable and pro industry incentive from the government.

    “The implications is that funding need to be incurred prior to taking benefits, hence the funding structure of exploration within the industry needs to be strengthened,” Baru said.

    Baru said the corporation was willing to work with partners and the industry in that regard.

    “We would open up new fields in terms of marginal fields development, dormant assets and new assets, as there are still condensing prospects for new oil and gas reserves in Nigeria, particularly in the ultra-deep water and inland frontier basins, and the timing and process must be transparent.”

    According to him, if this is done on consistent basis, the nation’s reserve replacement ratio, newly discovered reserves versus productions in the next 10 years will be more than double.

    Baru also said that funds could be raised from the Nigerian Content Development Monitoring Board (NCDMB), Local Content Fund or from the Central Bank of Nigeria, Seismic exploration support fund for Seismic survey in under explored areas of the country.

    Read Also: NNPC eyes new funding option to boost oil reserves

    The NNPC boss suggested that a revolving special fund could be created for the country’s hydrocarbon exploration on contributory funding basis.

    He said the NNPC would be willing to support such structures and was ready to create a workable framework.

    Baru said that the identification, evaluation, diversification and source of hydrocarbon were quite important and government also needed to develop a framework that would respond rapidly and quickly to external stimuli, particularly oil prices and increasing competition from other basins within the Gulf of Guinea.

    “Some of these incentives can include an allowance for deeper prospect drilling end of life tax break or tax holiday for matured assets, new reserves replacement bonuses.

    “The new and replacement terms are intentionally placed to ensure benefit and additions are earned based on meaningful work not on simulation data, catalytic application of enhanced oil recovery techniques or the likes, lower royalty rate for small fields and small allowances,” he said.

     

    NAN

  • Fuel supply: NNPC seeks to increase retail outlets

    The Nigerian National Petroleum Corporation (NNPC) says it is set to increase its 14 per cent market share in the nation’s downstream petroleum retail market.

    The Group Managing Director of NNPC, Dr Maikanti Baru, said this during NNPC Special Day at the ongoing Lagos International Trade Fair on Thursday in Lagos.

    The News Agency of Nigeria, reports that the fair was organised by the Lagos Chamber of Commerce and Industry (LCCI).

    Represented by Mr Ikem Obi, Chief Operating Officer, NNPC Downstream, Baru said the corporation aimed to go beyond its current 14 per cent market share of the downstream sector.

    “To aid in achieving this target, we have expanded our retail outlets, notable examples are, indeed, located here in the South-West.

    “For example, we have the newly constructed ultra-modern mega station along the Lagos-Ibadan Expressway.

    “The corporation is leaving no stone unturn to ensure that Nigerian Pipeline and Storage Company’s existing infrastructure are rehabilitated and new ones added as necessary steps to guaranteeing efficient storage and distribution of petroleum products across the nation, thereby ensuring supply reliability and energy security,” he said.

    Read Also: Minister clears air on suspension of National Carrier

    Baru said NNPC had recently completed the rehabilitation and restoration of the vandalized 36” and 42” QIT and 48” Forcados Oil Terminal (FOT) Export pipelines leading to resumption of production operations.

    “The corporation has also completed the repair of the vandalized 20” ELPS-A pipeline, thereby ensuring gas supply to gas-fired power plants and also supply into the West African Gas Pipeline.

    “We have also awarded the contract for the construction of the Ajaokuta-Kaduna-Kano (AKK) line gas infrastructure projects,” he said.

    He said that NNPC was expanding and integrating its gas pipeline network system to meet the unprecedented domestic gas demand and have recorded significant progress in the execution of key on-going gas pipeline infrastructure projects.

    He said that all these activities would invariably impact positively on the economy in view of the role of the oil and gas industry as the number one foreign exchange earner for the country and NNPC’s position as managers of government interests in the sector.

    Earlier, Mr Babatunde Ruwase, President of LCCI, said that the role of NNPC could not be overemphasised in ensuring petroleum products supply.

    He urged the Federal Government to expedite the passage of the Petroleum Industry Bill (PIB) and also create an enabling environment for businesses to thrive.

  • Senate probes NNPC diversion of $1.05 bn NLNG dividend

    The Senate, on Tuesday, asked its Committee on Gas Resources to investigate alleged diversion of $1.05 dollars by the Nigeria National Petroleum Corporation (NNPC).

    Group Managing Director of the NNPC, Maikanti Baru, last week, told the Senate that the NNPC was using Nigeria Liquefied Natural Gas (NLNG) funds to augment under-recoveries in the importation of Premium Motor Spirit (PMS).

    The NNPC GMD claimed that the landing cost of the product was higher than the government control price of N145 per liter.

    Baru who appeared before the Senate ad-hoc committee set up to investigate alleged $3.5 billion subsidy fund, noted that the fund was sourced from the NLNG dividend funds.

    He said that the decision was taken at the height of last fuel scarcity experienced by the country between December 2017 and January 2018.

    Baru said that the corporation acted in line with a directive from the National Assembly “to do everything necessary to end the scarcity of fuel in the country”.

    Baru noted that the decision was also in line with section 7 (4) (b) of the NNPC Act which mandates it to fund its operations from its revenues.

    The NNPC represents the Federal Government, which holds 49 per cent stake in the NLNG shareholding.

    In a statement on Monday, Senate President, Bukola Saraki, said that it was illegal for the NNPC to unilaterally draw from the NLNG dividend funds without appropriation by the National Assembly.

    Saraki said the dividends paid to the federal government from the NLNG business were supposed to be kept in the federation account and shared among the three tiers of government.

    Chairman of the Senate Committee on Gas, Senator Bassey Akpan, Tuesday, raised a point of order at plenary, seeking the permission of the Chamber to carry out a thorough investigation into the withdrawals and spending by the NNPC from the NLNG account.

    Akpan noted that utilizing the funds without appropriation by the National Assembly and without the knowledge of state and local governments was an illegal act that should be investigated.

    He said: “The Senate Committee on Gas has received several calls, complaints and questions from the general public through phone calls, emails on the basis of what has been trending in the newspapers and social media on the unauthorized withdrawal of over $1 billion from the proceeds of the NLNG dividends account by the NNPC.

    “The NLNG dividend account belongs to the three tiers of government and comes under the Consolidated Revenue Account. Therefore, any unauthorized withdrawal from the account without the approval of the National Assembly or any other structure of government is illegal.

    “I therefore, seek the leave of the President of the Senate, to allow the Senate Committee on Gas to investigate this withdrawal and other withdrawals and the way and manner the account of the NLNG proceed is treated by the NNPC and report back to the Senate,

    Senate Leader, Senator Ahmad Lawan, said that the investigation of the 1.05 billion dollar NLNG dividend fund should be left for the ad-hoc committee, which he chairs and is already looking into the matter.

    The 15-member ad-hoc Committee was set up on Oct. 16 to investigate the alleged secret spending of 3.5 billion dollars by the NNPC on fuel subsidy.

    Lawan said, “Mr President, I don’t think at this juncture that the Senate Committee on Gas should go and investigate the utilization of the 1.05 billion dollar from the NLNG dividend fund.

    “We are already doing that. But if the committee on gas is to do this, it means our work is over, because we adjourned, NNPC is presenting all their documents to the committee next week.

    “We are sitting this afternoon with other stakeholders. So, I pernally feel that this will subtract from what we are doing, and I think it will make our work unnecessary.”

    Senator Emmanuel Paulker (Bayelsa Central) disagreed with Lawan saying that the matter being investigated by the ad-hoc committee was different from the NLNG fund.

    He said: “The ad-hoc committee was set up specifically to look into the alleged spending of 3.5 billion dollars on fuel subsidy.

    Subsidy issue should not be confused with the issue of the interest that arose from the dividend of the NLNG. So, I believe they are two different issues.

    “So, while the ad-hoc committee is going on with their work to identify what NNPC did with the subsidy, I see nohting wrong for the gas committee to investigate the usage of the dividend arising from the NLNG Ltd,” Paulker said

    Saraki agreed with Akpan and Paulker.

    He said that the Gas committee’s investigation would be restricted to the utilisation of the NLNG dividend fund.

    He noted that the dividend issue was beyond the alleged 3.5 billion subsidy payment and should be separately investigated by the Committee on Gas.

    Saraki said: “Who knows, maybe the dividend is also being used for other things, may be for recurrent expenditure, we don’t even know. I think the ad-hoc committee’s investigation is wide, and Akpan is talking about dividend of NLNG being used for subsidy.

    “Could it be that the fund is also being used for other things as well? I think they are two separate issues.”

  • NNPC pumps up petrol price from Fuel Fund

    Nigeria National Petroleum Corporation (NNPC) boss Maikanti Baru yesterday told the Senate that the corporation spends $1.05billion from dividends of Liquefied Natural Gas (LNG) to augment daily shortages incurred in the pump price of Premium Motor Spirit (PMS).

    Baru appeared before the Senate Ad- Hoc Committee Investigating alleged illegal application of $3.5billion petroleum subsidy by NNPC.

    The NNPC Group Managing Director (GMD) denied the existence of any $3.5 billion for fuel subsidy.

    He noted that $1.05bn (equivalent of N383.2bn) taken from LNG dividends is domiciled in a special account with the Central Bank of Nigeria (CBN), called National Fuel Support Fund (NFSF).

    The fund, he said, is for augmenting losses incurred from petrol pump price of N145 per litre as against N185 per litre it is supposed to be.

    Baru said: “Based on available parameters from landing to transportation costs, the pump price of PMS is supposed to be N185 per litre as against the official price of N145 per litre, indicating shortage of N40 per litre.

    ” Since subsidy is not appropriated for and pump price is not adjusted upwardly, NNPC had no other choice than to in line with its establishment Act, Section 7 sub section 4(b), defray its costs from its revenues.”

    The GMD explained that the $1.05billion costs augmentation money came into being in October last year when Independent Marketers pulled out of the supply chain of importation of PMS into the country as a result of increase in landing cost without corresponding increase in pump price .

    Baru said subsidy or pump price increase could best be tackled by the National Assembly and not the NNPC, failure of which, he said, will make smuggling of petroleum products across Nigerian borders, lucrative business by smugglers.

    He said: “The N145 per litre pump price of PMS in Nigeria is the lowest when compared to N400 it is sold in Cameron, N350 in Ghana, N330 in Benin Republic etc.

    “As long as the product is sold at the lowest price in Nigeria, so shall it be attractive for smugglers to trade on across the borders.”

    Asked about the daily consumption of the product in the country, Baru said he did not know.

    He however told the committee that the consumption rate as at 2016 was 49m litres per day and 53m litres per day in 2017.

    He said NNPC has 1.9bn litres of PMS in stock which could last the country for 39 days in case of any breakdown in the supply chain.

    Baru’ s appearance before the committee was sequel to a resolution taken by the Senate on the 16th of last month for probe into alleged warehousing of $3.5bn by NNPC for fuel subsidy through a motion moved by the Senate Minority Leader, Biodun Olujimi.

    Apart from Baru, other government officials from the Ministry of Finance and the office of Auditor General of the Federation also appeared before the committee.

    Committee Chairman Senator Ahmed Lawan adjourned the sitting till Tuesday.