Crude export increases to $195.40m in December 2016

The total sale of crude oil that the Nigerian National Petroleum Corporation (NNPC) exported in December 2016 increased by $20.22million to hit $195.40million.

The corporation disclosed this in its monthly financial and operational reports of December last 2016, stressing that “A total export sale of $195.40 million was recorded in December, 2016. This is $20.22 million higher than the preceding month’s performance. Crude oil export sales contributed $100.37million (or 51.36%) of the dollar transactions compared with $96.31Million contribution in the previous month.”

According to the report that the corporation posted on its website yesterday,  the export gas sales amounted to $ 95.04 million in the month. January – December 2016 Crude Oil and Gas transactions indicate that Crude Oil & Gas worth $2,445,451.64million was exported.

The report noted that the Domestic Crude Oil and Gas receipt during the month amounted to N58.21 billion, consisting of N5.11billion from Domestic Gas and the sum of N53.10 billion from Domestic Crude Oil. Out of the Naira receipt, the sum of N25.86 Billion (N18.16 Billion out of N53.10 Billion and NNPC augmentation of N7.70billion) was transferred to Joint Venture Cash Call (JVCC) being a first line charge and to guarantee continuous flow of revenue stream to Federation Account.

Continuing, the reported said that “NNPC transferred the sum of N34.93 Billion into Federation Account during the month under review from the net domestic crude oil receipt and N5.11Billion from Gas receipts.

“Also, the 29th installment of the refund to FG of N6.33Billion was transferred. In 2016, Federation, JV, and FG received the sum N653.06Billion, N355.17 Billion and N75.96 Billion respectively.”

NNPC said that its group operating revenue for the months of November and December 2016 were ₦187.750billion and ₦206.40billion respectively.

It added that “This represents 79.04% and 86.89% respectively of monthly budget. Similarly, operating expenditure for the same periods were ₦206.47billion and ₦223.40 billion respectively, which also represents 98.46% and 106.54% of budget for the months respectively.”

NNPC, said the report, has been operating in a challenging environment which limits its aspiration to profitability.

It said that overall, a trading deficit of ₦17.01 billion was recorded for the month under review as against the reported November, 2016 trading deficit of ₦18.72billion.

The report said: “This represents a decrease of ₦1.71billion in trading deficit as against November, 2016. The marginal decrease is due to improved PPMC Coastal sales following completion of reconciliation with other marketers. Other factors that affected the overall NNPC’s performance include Force Majeure declared by SPDC as a result of the vandalized 48- inch Forcados export line after the restoration on 17th October, 2016 amongst others.”

On federation crude oil and gas revenue, the December report explained that Federation Crude Oil and Gas lifting are broadly classified into Equity Export Crude and Domestic Crude. Both categories are lifted and marketed by NNPC and the proceeds remitted to the Federation Account.

Equity Export receipts, after adjusting for Joint Venture (JV) Cash Calls, according to the report, are paid directly into JP Morgan Account operated by Central Bank of Nigeria (CBN). Domestic Crude Oil of 445,000bopd is allocated for Refining to meet domestic products supply. Payments are effected to Federation Account by NNPC after adjusting crude & product losses and pipeline repairs & management cost incurred during the period.

The report reads in part: “NNPC also lift Crude Oil and Gas, other than Equity and Domestic Crude Oil, on behalf of DPR and FIRS proceeds of which are remitted into Federation Account.

“The Third Party finance lifting are Crude Oil and Gas from fields that are financed using alternative finance/loan facility which require the servicing of debt obligations before remitting the balance to Federation Account as Price Balance as shown below:

“Total export proceeds of $175.04 million were recorded in December 2016 as receipt against $162.40 Million in November 2016. Contribution from Crude oil amounted to $97.87 Million while Gas and miscellaneous receipt stood at $77.16 Million and $0.015 Million. The total export proceeds was remitted to fund the JV cash Call for the month of December 2016 to guarantee current and future production.

“Total export crude Oil & Gas receipt for the period of January, 2016 – December, 2016 stood at $2.40 Billion. Out of which the sum of $ 2.33 Billion was transferred to JV Cash Call in line with 2016 Approved Budget (See Table & Chart 6.3.1) and the balance of $0.073Billion was paid to Federation Account. However, this JVCC amount falls short of the 2016 Appropriated amount of $.8.55Billion (See Table & Chart 6.3.1). This is due to twin effect of production disruption in Niger-Delta and low Crude Oil prices during the year.”