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NNPC To Deliver Zero FAAC Remittance in May As Subsidy Payment Eats Deeper

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NNPC Nigeria

The Nigerian National Petroleum Corporation (NNPC) has disclosed that its projected monthly remittance to the Federation Accounts allocation committee (FAAC) for May will be zero.

This implies that the three tiers of government, federal, states and local governments, are in for tough times next month as they may get less from the Federation Account.

Already, the NNPC, which is being made to bear the cost for the price differential between the market price and pump price of petrol on behalf of the federation has served a notice that it will not be able to remit any funds to the Federation Account in April for distribution in May.

In a letter by the corporation to the Accountant-General of the Federation (AGF), Mr. Ahmed Idris,

NNPC said it posted a value shortfall of N111.966 billion in February 2021, which will ultimately impact on its ability to contribute to the joint account shared by the federal, state and local governments.

A copy of the letter, signed by the corporation’s Chief Financial Officer, Mr. Umar Ajiya, and dated April 26, 2021, was obtained by the media yesterday.

The minister of finance, budget, and national planning; the director-general, Nigeria Governors’ Forum; the director, home finance; and the chairman, Commissioners of Finance Forum were copied.

The implication is that the zero remittance from the NNPC may affect the monthly allocation to states, which may ultimately struggle to meet their statutory obligations, including payment of salaries and pensions.

The NNPC, in the letter, attributed the N111.966 billion shortfall to the rising average landing cost of petrol, which jumped to N184 per litre in March as opposed to the existing N128 ex-coastal price.

According to the corporation, the N111.966 billion incurred as landing costs would be deducted from April oil and gas proceeds due to the federation in May.

It stated: “Further to our previous correspondences on the above subject, we wish to advise on the projected remittance to the Federation Account for the months of April (May FAAC) to June 2021 (July 2021 FAAC).

“The accountant-general of the federation is kindly invited to note that the average landing cost of petrol for the month of March 2021 was N184 per litre as against the subsisting ex-coastal price of N128 per litre, which has remained constant notwithstanding the changes in the macroeconomics variables affecting petroleum products pricing.

“As the discussions between government and the labour are yet to be concluded, NNPC recorded a value shortfall of N111, 966, 456, 903.74 in February 2021 as a result of the difference highlighted above.”

The corporation said a projection of remittance to the Federation Account for the next three months had been sent to the Office of the Accountant-General.
It added: “Accordingly, the AGF is invited to note that the sum of N111,966,456,903.74 will be deducted from April 2021 oil and gas proceeds due to the federation in May 2021, which will translate to zero remittance to the Federation Account from NNPC in the month of May 2021.”

The corporation stated that the move was to ensure the continuous supply of petroleum products to the nation and the guarantee of energy security in the country.

Group Managing Director of the NNPC, Mallam Mele Kyari, had earlier raised the alarm over the rising landing cost of the product, saying that the NNPC could not continue in that trajectory.

However, earlier this month, Kyari assured the nation that there would be no price increase, even till May, as negotiations between labour and the federal government was continuing.

Also, during a visit to President Muhammadu Buhari, Kyari had said the NNPC had continued to shoulder the burden of paying subsidies, adding that in a deregulated pricing system, the product would be selling above N200 rather than the current N162 official price.

“The price could have been anywhere between N211 and N234 to the litre. The meaning of this is that consumers are not paying for the full value of petrol that we are consuming and, therefore, someone is paying that cost,” he said, adding: “As we speak today, the difference is being carried in the books of NNPC and I can confirm to you that NNPC may no longer be in a position to carry that burden.”

In March last year, when the international price of crude oil was low, the federal government announced that it had deregulated the downstream sector, which meant that the pump price would be determined by market forces.

That policy was implemented for months until crude oil prices rose again, and the eventual return of subsidies’ payment, which the NNPC has put at about N120 billion monthly.

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Air Peace Flight Makes Emergency Landing Due to False Fire Warning

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Passengers aboard Air Peace Flight APK7193 experienced a tense moment as the aircraft made an emergency landing at Murtala Muhammed Airport in Lagos following a false fire warning in the cockpit.

The incident, which occurred on Thursday during the flight from Port Harcourt, highlighted the swift response and safety protocols implemented by the flight crew amidst the alarming situation.

With 243 passengers and 12 crew members on board, the flight’s pilots noticed a fire warning indicator in the cockpit, prompting immediate action.

Acting swiftly, the pilots executed all necessary safety measures and initiated an emergency landing procedure.

At 4:45 pm, the aircraft safely touched down on Runway 18L at the Lagos airport, averting a potential crisis.

Upon landing, fire fighting personnel stationed at the airport observed smoke emanating from the engines, prompting the pilots to shut down the engines as a precautionary measure.

However, it was later confirmed that the observed smoke was unrelated to any fire event, reassuring passengers and crew of their safety.

Air Peace promptly issued a statement addressing the incident, titled “Notification of false fire alarm on Port Harcourt-Lagos flight.”

The airline clarified that the fire warning indicator noticed in the cockpit was indeed a false alarm.

The statement emphasized the airline’s commitment to safety and reassured the flying public that all necessary precautions were taken to ensure the well-being of passengers and crew.

“We want to reassure the flying public that safety remains our utmost priority, and we are unwavering in our commitment to it,” the statement read.

Despite the momentary panic caused by the false fire warning, the swift and coordinated response of the flight crew, coupled with adherence to safety protocols, ensured a safe and uneventful landing for all passengers and crew members.

The incident serves as a testament to the importance of rigorous safety procedures and the critical role played by well-trained aviation professionals in ensuring passenger safety.

As investigations into the cause of the false fire warning are likely underway, Air Peace’s response underscores the airline’s dedication to transparency and accountability in addressing safety-related incidents.

Passengers and industry stakeholders alike can take solace in the airline’s commitment to maintaining the highest standards of safety and operational excellence.

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Saudi Arabia Breaks 70-Year Alcohol Ban, Opening Shop for Diplomats

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Alcohol

Saudi Arabia has announced the opening of an alcohol shop in Riyadh, breaking a 70-year-long prohibition on the sale of alcoholic beverages in the kingdom.

This decision marks a significant shift in the conservative nation’s stance on alcohol consumption.

The alcohol shop, set to be located in Riyadh’s Diplomatic Quarter, will exclusively serve non-Muslim expatriates, particularly diplomatic staff.

This is the first time since 1952 that alcohol will be legally available for purchase in the kingdom.

The initiative aims to provide a legal avenue for diplomats who have previously relied on importing alcohol in sealed diplomatic pouches.

The decision comes as part of the Saudi government’s efforts to address the issue of illicit alcohol trade within the country.

By offering a legal means to access alcohol, authorities hope to mitigate the risks associated with underground alcohol markets.

However, the shop’s operations will be subject to strict regulations. Only diplomatic staff with prior registration and government clearance will be allowed to purchase alcohol.

Also, patrons must be over 21 years old and adhere to a prescribed code of conduct while inside the shop.

The introduction of the alcohol shop is a part of broader societal reforms under Saudi Arabia’s Vision 2030 initiative, aimed at modernizing and diversifying the kingdom’s economy.

While the move represents a significant departure from traditional norms, it aligns with the government’s broader agenda of liberalizing certain aspects of Saudi society.

While the alcohol shop signifies a progressive step forward, it’s important to note that the sale and consumption of alcohol remain strictly prohibited for Saudi citizens under Islamic law.

Violators of these laws are subject to severe penalties, including fines, and imprisonment.

Overall, the opening of the alcohol shop marks a historic moment in Saudi Arabia’s social and economic landscape, signaling a willingness to adapt to changing global norms while navigating the complexities of religious and cultural traditions.

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NCAA Suspends Dana Air’s Operations Amid Safety Concerns

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Dana Air

The Nigerian Civil Aviation Authority (NCAA) has taken decisive action following a recent incident involving Dana Air by suspending the airline’s operations amid escalating safety concerns.

This move comes in the wake of an unsettling event where a Dana Air plane veered off the runway upon landing at Lagos airport.

The incident, which occurred shortly after a flight from Abuja, prompted emergency responders and regulatory agencies to swiftly respond and ensure the safety of all 83 passengers and crew onboard.

While initial reports indicate no injuries, the occurrence raised red flags regarding Dana Air’s operational safety protocols.

In response, NCAA wasted no time in initiating a thorough investigation with the Nigerian Safety Investigation Bureau leading the probe.

However, pending the investigation’s outcome, the regulatory body opted for a precautionary measure by suspending Dana Air’s Air Operator Certificate (AOC) effective April 24, 2024, at 23:59.

The suspension, outlined in a letter signed by Acting Director Chris Najomo, aligns with Section 31(7) of the Civil Aviation Act 2022.

The Minister of Aviation and Aerospace Development, Festus Keyamo, expressed dismay over the incident.

In a letter addressed to NCAA, the Ministry directed the immediate suspension of Dana Air’s fleet until a comprehensive audit could be conducted, covering safety protocols, maintenance procedures, and financial health.

The suspension serves as a stern reminder of the aviation industry’s uncompromising commitment to safety and underscores the need for thorough oversight to safeguard passengers and maintain industry standards.

As stakeholders await further developments, the focus remains on ensuring the highest level of safety and regulatory compliance within Nigeria’s aviation sector.

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