The most recent information available from the Ministry of Finance states that the Federal Government will start selling crude oil to the Dangote refinery in naira on October 1.
This is a big step towards making sure the Presidential Directive on Crude Oil Sales in Naira is quickly implemented to support Nigeria’s economic development and progress.
Wale Edun, the minister of finance and coordinating minister of the economy, presided over a critical meeting of the Federal Government’s Implementation Committee on Crude Oil Sales in Naira on Monday in Abuja, where several important decisions were made.
In a statement signed by Mohammed Manga, the director of information and public relations, the finance ministry stated, “The Committee reviewed progress on key initiatives, including the upcoming commencement of Naira payments for crude oil sales to the Dangote Refinery starting from October 1, 2024, marking a significant milestone in Nigeria’s economic transformation.”
To ensure that the President’s directives are being implemented as planned starting in September, the Finance Minister underlined the need for transparency and gave the Technical Sub-Committee instructions to finalize specifics and prepare a report.
He expressed optimism that the cooperation of all parties involved, including financial institutions and regulatory agencies, would guarantee a transparent and effective implementation process as Nigeria smoothly moves towards selling crude oil in Naira.
The first PMS delivery from Dangote is anticipated next month by the current agreements, according to a report made during the meeting by Zacch Adedeji, Chairman of the Technical Sub-Committee and Chairman of the Federal Inland Revenue Service (FIRS).
To ensure a smooth implementation, key roles were outlined for stakeholders, including the African Export-Import Bank (Afreximbank), the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), the Central Bank of Nigeria (CBN), and the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA).
There were also updates on the Port Harcourt and Dangote refineries, with notable production increases anticipated starting in November 2024.
Additionally, President Tinubu gave the Nigerian National Petroleum Company (NNPC) Limited permission to pay for fuel subsidies with the final profits that the company owed the federation in 2023.
To further improve NNPC’s cash flow, the president also approved stopping the federation’s 2024 interim dividend payments.
Additionally, NNPC reported to the president that it is presently unable to pay taxes and royalties into the federation account as a result of the subsidy payments; it refers to this as a “subsidy shortfall/FX differential.”
According to an estimate from NNPC acquired by BusinessDay, the corporation will not be able to pay N3.987 trillion in taxes and royalties to the federation account since the total expenses for petrol subsidies from August 2023 to December 2024 will reach N6.884 trillion.
At the time this report was filed, it was not possible to confirm the precise amount of dividend that would be withheld or delayed.
