Petrol Subsidy Drops To N1.7b Daily | Independent Newspapers Limited
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Petrol Subsidy Drops To N1.7b Daily

Posted: Aug 3, 2015 at 1:39 am   /   by   /   comments (0)

By Obas Esiedesa, Abuja

The Petroleum Products Pricing Regulatory Agency (PPPRA) at weekend released a new template for Premium Motor Spirit (petrol) which puts its open market price at N131.57 per litre.

With the new price government is paying N3.03/litre less than it did last month when the open market price was 134.60/litre.

This means subsidy per litre is N44.57 and at an estimated daily consumption of 40 million litres, the daily subsidy on petrol is now N1.78billion, down from N1.9b last month.

PMS at filling stations is sold at the government regulated price of N87/litre. It saves government about N121 million daily.

The PPPRA revealed on its website at the weekend that the new pricing template took effect from Saturday, August 1, 2015 and was based on Platts Prices for  July 31, 2015.

A breakdown of the template per litre showed that the off-shore price is N104.19, traders margin N1.47, lightering expenses N4.18, NPA 0.77, financing N1.66, jetty depot through put charge N0.80, and storage charge, N3.00.

This brings the landing cost to N116.08 per litre.

The distribution margin according to the agency is made up of retailers N4.60, transporters N2.99, dealers N1.75, bridging fund N5.85, Marine Transport Average (MTA) N0.15, and administrative charge N0.15.

With this, the distribution margin came to N15.49 and open market price of N134.49 per litre.

PPPRA retained the ex-depot price (for collection) at N77.66.

The reduce subsidy payment came few days after the Nigerian National Petroleum Corporation (NNPC) announced that the Port Harcourt and Warri refineries have been successfully re-streamed after a nine-month phased rehabilitation exercise conducted by its in-house engineers and technicians.

The corporation, in a statement by its spokesman, Ohi Alegbe revealed that both plants have commenced preliminary production of petroleum products after successful test-runs.

He noted that while PHRC is ramping up its operation to about 60 percent of its 210, 000 barrels per day name plate capacity; WRPC production is projected to hit 80 percent of its installed 125, 000 bpd capacity.