The Group Chief Executive Officer of the Nigerian National Petroleum Company Limited, Mele Kyari, revealed on Thursday that the Central Bank of Nigeria has established a department to handle transactions involving the sale of crude oil by the company.
The decision to shift a sizable chunk of the company’s revenue to the central bank was agreed by the NNPCL Board of Directors, Kyari further disclosed.
This was announced at the same time as the major national oil company said there would be no immediate increase in the price of Premium Motor Spirit, or petrol. As it has been doing for a while, NNPCL is Nigeria’s only importer of petrol.
President Bola Tinubu reportedly gave the CBN instructions in January to take responsibility for crude oil sales proceeds from the NNPCL. Consequently, NNPCL is expected to submit the receipts for crude oil sales to CBN for vetting and documentation.
During the meeting held at NNPCL’s headquarters between the management and the CBN team, which was headed by the bank’s governor, Olayemi Cardoso, Kyari declared his approval of the decision to transfer the oil company’s transactions to CBN.
He stated, “We are pleased to have the CBN governor and his senior management team join NNPC Ltd. We fully recognize the timeliness of this examination of our choice to shift a sizeable chunk of our revenue to the CBN.
“Being a massive organization, our transaction and liquidity levels are very high, and perhaps we are the largest business in this country. We are also happy that the CBN has created a robust digital platform for our transactions.”
Cardoso stated that the CBN had reorganized its internal procedures in order to be ready to handle the massive amount of responsibility that the national oil corporation would be placing on the bank.
“We are eager to work with NNPC even more, and I am confident that this productive relationship will serve NNPC and Nigeria’s interests to the fullest.”
Last week, there were mixed reactions to the decision to transfer NNPCL’s oil sales operations to CBN. While some people supported the move, others objected.
For example, the Peoples Democratic Party’s presidential candidate for 2023, Atiku Abubakar, said that it was unlawful for the federal government to have ordered CBN to assume accountability for the earnings from the sale of crude oil from NNPCL.
“It must be clearly stated that the action is not legal in its application, without prejudice to the possibility of any good that was intended in the decision of the Federal Government to make the CBN take over the responsibility for crude oil sales proceeds from NNPCL,” Atiku said in a statement.
“This is an unprecedented action with no moral or legal justification. In public administration, it also transgresses the due process principle. State-owned businesses have complete financial control within the parameters of their particular establishment rules and are not vulnerable to such capricious instructions.”