Minister of finance and coordinating minister of the economy, Wale Edun, has assured that the Nigerian National Petroleum Company (NNPC) Limited will clear the $6 billion debt owed to refined petrol suppliers soon.
He gave the assurance during a global investor engagement forum on the sidelines of the 2024 annual meetings of the International Monetary Fund (IMF) and the World Bank.
Edun, while speaking to the issue of the debt owed refined petrol suppliers by the NNPC, said the national oil firm would soon start clearing the debt.
“In terms of NNPC and their situation, the reality is that, although the subsidy on May 29, 2023, was removed and was no longer on the balance sheet of the government, it did rear its head, not in terms of petrol subsidy, but foreign exchange subsidy, which was borne elsewhere, and borne mainly by NNPC.
“I think what I can say about their own situation is with where they are now, they have a route to paying down their payables and I’m sure that in no time at all, they will start. From what I understand, they have even commenced the process of paying down their payables,” the minister said.
On the issue of pricing, Edun said the Central Bank of Nigeria (CBN) moved to a willing buyer, willing seller, market-based pricing mechanism for foreign exchange (FX), adding that the same system applies to petroleum products.
“The same is now true of petrol. Diesel is willing buyer, willing seller, market-based. Kerosene is a free market pricing. Jet fuel is free market pricing and now petrol is the same.
“So, we have local refiners that are able to buy crude in naira. They have their margins, they refine, and they sell in naira and that is the market that we have now.
“Importantly, we can see that it is the first time, in maybe 40 years, that we have had that. It’s taken tremendous, not just boldness and courage, but determination and not just determination, but no small level of skill and consultation and so forth.
“The idea is that there is determination to maintain market pricing of petrol and what that will mean is that the wasteful and inefficient and costly 5 percent of GDP that was flowing out of Nigeria to the benefit of a few people and surrounding countries will now be available to develop and modernise the Nigerian economy,” Edun said.
