Oil price drop, production challenges cut monthly revenue by N14.62bn

18 March 2015, Abuja – The falling price of crude oil has continued to lower the country’s monthly revenue prospects as gross receipts for February dropped by N14.62 billion to N401.46 billion compared to N416.09 billion the previous month.

Dr. Ngozi Okonjo-Iweala

Dr. Ngozi Okonjo-Iweala

Nevertheless, total distributable revenue of N522.05 billion was on Wednesday shared among the three tiers of government for February compared to N500.13 billion in January.

Addressing journalists last night in Abuja after the monthly meeting of the Federation Accounts Allocation Committee (FAAC), the Minister of State for Finance, Alhaji Basir Yuguda, said there was a loss of about $24.48 million in revenue due to further drop in. Rude oil prices from $52.33 billion in December 2014 to $48.65 in January 2015.

He added that revenue from gas also dropped from $420.600 per metric tonne in December 2014 to $190.226 per metric tonne in January 2015.

He noted that the persistent shut down and shut in of trunks and pipelines at various terminals continued to impact negatively on the revenue performance while the non-oil revenues dipped further to February relative to the previous month.

Mineral revenue for the month in review stood at N306.94 billion compared to N305.39 billion while the non-mineral component was N94.52 billion against N110.69 billion in January

The value added tax (VAT) fell to N58.25 billion compared to N63.93 billion the previous month.

Meanwhile, Yuguda also refuted allegations in some quarters that some state governments are currently unable to pay workers salaries because of outstanding payment from the federation accounts.

He said the federal government was not owing any amount to the states.

“We even gave them what they do not expect,” he said, referring to foreign exchange gain which are often worked out and shared among the three tiers of government.

He affirmed that the value of the excess crude account (ECA) remained at $2.6 billion.

Of the net statutory allocation, the federal government received N186.60 billion, while the states shared N94.64 billion as well as the local governments which got N72.96 billion.

The sum of 39.57 billion was allocated to the oil and gas producing regions under the derivation principle.

For VAT, the federal government got N8.36 billion, while the states shared N27.96 billion as well as the local governments, which received N19.57 billion.

Also speaking with journalists after the meeting, Chairman, Commissioners of Finance Forum, Mr. Timothy Odah, restated the position of state governments to remove all sorts of subsidies and rather share the allocations to them amid the falling oil price and attendant fiscal challenge.

He said over 30 per cent of allocations to states went to addressing security concerns amid the upcoming general election.

– This Day

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