In line with its new status as a private sector operator and also to show its income-generating capacity in the post Petroleum Industry Act (PIA) 2021, the Nigerian National Petroleum Company Limited (NNPCL), on Thursday paid N123 billion interim dividend and PSC profit oil to the Federation Account Allocation Committee (FAAC).
The payment which is a break away from the past, is one of the reasons the accruals to the Federation Account Allocation Committee (FAAC) for June 2023 shot up to N1.9 trillion.
It would be recalled that FAAC on Thursday shared N907 billion among the three tiers of government.
Sources at the Office of the Accountant General of the Federation (OAGF) told InsideBusiness that the breakdown of the N123 billion payment was N81 billion monthly interim dividend and N42 billion being 40 percent of the Production Sharing Contract (PSC) profit.
This payment according to sources “is in exclusion of payment of royalties and taxes”.
The move is a marked departure from previous years of sleaze and wastage which the oil firm is noted for, and which a top NNPCL official said, will set the track for future profitability and global best practices, ranking it with world-class oil companies like Saudi Aramco, China Petroleum & Chemical Corp., Exxon Mobil Corp., and others.
“Mele Kyari led NNPCL aims to set the nation’s oil company on the path of profitability and sustainable growth. Since the transformation of the NNPC from a loss-making organization pre-PIA to a robust profit-making company post-PIA” said the source who stated that the company under the Group Chief Executive Officer (GECO) has pursued global governance best practices to reposition for greater growth”.
The source that spoke on condition of anonymity said the payment to FAAC“ clearly shows that the company under the leadership of Kyari is moving in a positive trajectory as enshrined in the PIA”.
Bawa Mokwa Director, Press and Public Relations, OAGF in a statement on Thursday said the N907.054 billion total distributable revenue comprised distributable statutory revenue of N301.501 billion, distributable Value Added Tax (VAT) revenue of N273.225 billion, Electronic Money Transfer Levy (EMTL) revenue of N11.436 billion and Exchange Difference revenue of N320.892 billion.
In June 2023, the total deductions for the cost of collection were N73.235 billion and the total deductions for savings, transfers, and refunds were N979.078 billion noting that the balance in the Excess Crude Account (ECA) was $473,754.57
At the end of the FAAC meeting chaired by the Accountant General of the Federation (AGF), Oluwatoyin Madein stated that from the total distributable revenue of N907.054 billion; the Federal Government received N345.564 billion, the State Governments received N295.948 billion and the Local Government Councils received N218.064 billion. A total sum of N47.478 billion was shared to the relevant States as 13% derivation revenue.
Gross statutory revenue of N1,152.921 billion was received for the month of June 2023. This was higher than the sum of N701.787 billion received in the previous month by N451.134 billion.
From the N301.501 billion distributable statutory revenue, the Federal Government received N146.710 billion, the State Governments received N74.413 billion and the Local Government Councils received N57.370 billion. The sum of N23.008 billion was shared to the relevant States as 13% derivation revenue.
For the month of June 2023, the gross revenue available from the Value Added Tax (VAT) was N293.411 billion. This was higher than the N270.197 billion available in the month of May 2023 by N23.214 billion.
The Federal Government received N40.984 billion, the State Governments received N136.613 billion and the Local Government Councils received N95.629 billion from the N273.225 billion distributable Value Added Tax (VAT) revenue.
The N11.436 billion Electronic Money Transfer Levy (EMTL) was shared as follows: the Federal Government received N1.715 billion, the State Governments received N5.718 billion and the Local Government Councils received N4.003 billion.
From the N320.892 billion Exchange Difference revenue, the Federal Government received N156.155 billion, the State Governments received N79.204 billion, the Local Government Councils received N61.063 billion and the sum of N24.470 billion was shared to the relevant States as 13 percent mineral revenue.
According to the communiqué, in the month of June 2023, Companies Income Tax (CIT) recorded tremendous increase. Import and Excise Duties, Value Added Tax (VAT), Oil and Gas Royalties increased significantly, while Petroleum Profit Tax (PPT) and Electronic Money Transfer Levy (EMTL) decreased considerably.
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