NNPC Begins Repayment of $6 Billion Petrol Supply Debt, Says Finance Minister Edun
In a significant development, the Nigerian National Petroleum Company (NNPC) Limited has started repaying a $6 billion debt owed to suppliers of premium motor spirit (PMS), commonly known as petrol. The announcement was made by Nigeria’s Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, during a meeting with investors in Washington, D.C., on the sidelines of the 2024 International Monetary Fund (IMF) and World Bank annual meetings.
Mr. Edun addressed concerns about NNPC’s financial stability, noting that although the government removed petrol subsidies on May 29, 2023, foreign exchange subsidies linked to petrol imports have persisted, borne primarily by NNPC. He assured investors that NNPC has a clear plan to settle its outstanding obligations, with the repayment process already underway.
The minister’s remarks follow NNPC’s previous admission that it owed international oil traders approximately $6.8 billion. NNPC had clarified that owing debts in the oil trading business is common due to credit-based transactions. The company is reportedly addressing its debt through its subsidiary, NNPC Trading, by settling invoices on a first-in, first-out (FIFO) basis.
This debt repayment is expected to improve NNPC’s financial standing and ensure a steady supply of petrol in the domestic market.
In a significant development, the Nigerian National Petroleum Company (NNPC) Limited has started repaying a $6 billion debt owed to suppliers of premium motor spirit (PMS), commonly known as petrol. The announcement was made by Nigeria’s Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, during a meeting with investors in Washington, D.C., on the sidelines of the 2024 International Monetary Fund (IMF) and World Bank annual meetings.
Mr. Edun addressed concerns about NNPC’s financial stability, noting that although the government removed petrol subsidies on May 29, 2023, foreign exchange subsidies linked to petrol imports have persisted, borne primarily by NNPC. He assured investors that NNPC has a clear plan to settle its outstanding obligations, with the repayment process already underway.
The minister’s remarks follow NNPC’s previous admission that it owed international oil traders approximately $6.8 billion. NNPC had clarified that owing debts in the oil trading business is common due to credit-based transactions. The company is reportedly addressing its debt through its subsidiary, NNPC Trading, by settling invoices on a first-in, first-out (FIFO) basis.
This debt repayment is expected to improve NNPC’s financial standing and ensure a steady supply of petrol in the domestic market.