The Nigerian National Petroleum Corporation (NNPC) on Wednesday denied Senate’s allegation that it had a $3.5 billion fund to surreptitiously subsidise imports of petroleum products.
The Senate had on Tuesday hinted that it would investigate the fund it said the NNPC was utilising, without subjecting it to parliamentary scrutiny through the national budget.
NNPC responded in a statement issued by its Spokesman, Ndu Ughamadu, that it did not have $3.5 billion subsidy fund.
It said a $1.05 billion “National Fuel Support Fund” did exist and was set up by the company “to ensure stability in the petroleum products supply.”
The corporation said that the fund was jointly managed by a group of bodies that included the NNPC, the Central Bank of Nigeria and the Finance Ministry.
It said the fund was domiciled in the central bank and NNPC did not independently spend a dime of it.
Fuel subsidies are contentious in Africa’s top crude oil producer, which imports most of its gasoline due to under-performing refineries and prices are kept artificially low at N145 ($0.48) per litre.
As fuel prices increase globally, it has become unprofitable for private petrol marketers to import, with the NNPC stepping in to prevent major shortages.