NNPC says crude oil production, price benchmark for 2024 budget realistic

…Pledges to maintain level of dividends projected in MTEF
Group Chief Executive Officer (GCEO) of NNPC Limited, Mele Kyari

The NNPC asserts that the crude oil production and price benchmark for the 2024 budget are realistic and achievable.
The organization's Group Chief Executive Officer (GCEO), Mele Kyari, emphasized that the projected budget benchmark price of $77.96 per barrel is well-founded, considering the current market dynamics and future projections. 

Additionally, Kyari stated that the projected 1.785 million barrels per day of crude oil production for 2024 is attainable. The NNPC's position is in line with its commitment to the budget benchmark approved by the government.

Mele Kyari, gave the assurance during an interactive session with the Senate Committee on Finance at the National Assembly, Abuja, on Wednesday, December 13, 2023.

Speaking on the dynamics of the market in relation to the projected budget benchmark price of $77.96 per barrel, Kyari said: “With what we see in the market today and potentially in the year 2024 and even beyond the next two years, it is very unlikely to see $70 per barrel oil in the market. The oscillation we are seeing, sometimes you do see prices coming down to $75 to the barrel and sometimes it goes above it, overall, benchmarks are averages. We think that the proposal by Mr. President around the $77.96 is still realisable in 2024.”

On the crude oil production projection, he stated: “The number we have is 1.785mbpd. This is cumulative of all oil produced in the country. This figure is inclusive of all production including crude oil and condensate. I need to make this clarification because of the reports in the media that our OPEC quota is 1.5million barrels per day. The OPEC quota is related only to crude oil. We also do between 250,000 to 300,000 barrels per day of condensate in our production. When you combine the two, the 1.78mbpd is realistic and realisable.”

He expressed optimism that though there were challenges such as security and force majeure, the measures being deployed by the Federal Government would be able to take care of them to guarantee the projected level of production.

The GCEO, in a press release issued by Olufemi O. Soneye, Chief Corporate Communications Officer, NNPC Ltd, also assured that the company will maintain the level of dividends remittance to the Federation Account as stated in the Medium-Term Expenditure Framework. He added that the projected dividends from the Nigeria Liquefied Natural Gas Ltd. was also realizable and would be flowed directly into the Federation Account as stipulated by the law.

While answering a question on the Company’s Road Tax Credit Scheme, Kyari explained that all the roads being undertaken under the scheme would be duly completed, adding that the scheme was anchored by the Ministry of Works while the Federal Inland Revenue Service and NNPC Ltd. were only playing supervisory roles to ensure that value is delivered for every kobo paid.

Speaking earlier, chairman of the Senate Committee on Finance, Senator Mohammed Sani Musa, said the purpose of the interactive session was to deepen conversations on the projections in the 2024 Appropriation Bill to help the lawmakers determine what and where to adjust.

He expressed satisfaction with the explanations offered by the NNPC Ltd.’s helmsman.
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