- Senate has frowned at the management of NNPC over the high cost of oil production
- The upper legislative chamber also criticised low profit of $3 per barrel for Nigeria
- Adeola Olamilekan, the chairman, Senate committee on finance, said that while the cost of oil production in Saudi Arabia is $4 per barrel, it is $21.2 per barrel in Nigeria
The management of the Nigerian National Petroleum Corporation (NNPC) was grilled on Monday, June 1, by the Senate over the high cost of oil production, leading to a very low profit of $3 per barrel for the country.
Vanguard reports that the Senate was informed of the high cost of oil production which is $21.2 per barrel, almost equaling $25 per barrel oil price benchmark fixed for the N10.509 trillion 2020 revised budget when officials of the corporation appeared before the Senator Olamilekan Adeola (APC, Lagos West) led Senate committee on finance.
Legit.ng gathered that the senators, however, kicked against what they described as the $3 marginal profit being made on a barrel by the corporation.
The lawmakers, therefore, called on the federal government to as a matter of urgency, to put in place, measures that would get the nation’s economy diversified especially as a post COVID-19 measure.
According to the report, the controversy started when NNPC's chief operating officer (upstream), Yemi Adetunji, was called upon by Senator Adeola to explain why the cost of oil production in Nigeria was far higher than those of other oil-producing countries of the world.
Senator Adeola said that while the cost of oil production in Saudi Arabia is $4 per barrel and $3 per barrel in Russia, it is $21.2 per barrel in Nigeria, indicating very poor marginal profit of about $3 per barrel based on new oil price benchmark of $25 per barrel.
Meanwhile, Legit.ng had previously reported that Mele Kyari, the group managing director of the NNPC, said the slump in the US crude oil futures below $0 per barrel is not a reflection of the reality in the global oil market capable of impacting Nigeria’s oil production.
In another report, Bishop Isaac Idahosa, the general overseer of God First Ministry, distributed palliatives to ministers of God to be able to stay afloat in this pandemic which has ravaged the world.
The minister invited thousands of pastors who besieged his Ibeju Lekki church for the distribution process, and they were all smiles as they received the palliatives from the man of God.
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