Friday 8 July 2016

NNPC reports profit of N274m for the month of May; ...first operating profit in 15 years!

Nigerian National Petroleum Corporation (NNPC)
After ten months under the stewardship of Dr. Ibe Kachikwu as the Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), the state-run oil firm finally turned the corner, reporting an operating profit of N273.74 million for the month of May and reversing the losses of N35 billion made by NNPC over the last 15 years.

A copy of NNPC’s monthly financial and operations management report showed that the corporation’s N273.74 million operating profit in May 2016 as against its operating loss of N19.43 billion in April was attributed to improved cost efficiency at the corporate headquarters of NNPC and performance by the Petroleum Products Marketing Company (PPMC).
The monthly report stated: “PPMC recorded a net gain of N17.69 billion as against the net loss of N6.91 billion in April, 2016 following complete stoppage of commercially unfavourable swaps and offshore processing agreements (OPAs).
“Direct-Sale and Direct-Purchase has now replaced the previous regime. Notwithstanding these improvements, renewed and vigorous vandalism of pipelines in Niger Delta means that productions were shut-in and cargoes deferred, which denied revenues streams accruing to NPDC and the federation.”
The report showed that the group’s operating revenue for the months of April and May 2016 were N95.51 billion and N142.53 billion respectively, representing 30.36% and 45.32% respectively of the monthly budget.

Similarly, operating expenditure for the same periods were N121.86 billion and N142.26 billion respectively, which also represents 45.62% and 52.63% of the budget for the months respectively.

Operating deficits of N19.43 billion and a margin of N0.27 billion were recorded for the months of April and May 2016 respectively as against the monthly budgeted surplus of N44.23 billion.
The report said the deficit “was inverted in the month of May 2016 due to significant increase in revenue generation which could be attributed to the rise in petroleum product sales by 51.13%”.
However, NPDC’s substantial portion of crude sales for the month amounting to about N20 billion could not be realised due to crude pipeline vandalism.

The report also highlighted the corporation’s activities for twelve months period of June 2015 – May 2016 to allow for trend recognition.

In the area of crude oil and condensate production, the report showed that a total of 59.56 million barrels of crude oil and condensate was produced in the month of April 2016, representing average daily production of 1.99 million barrels and a decrease of 1.72% compared to March 2016 performance.

Credit: ThisDay

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