The Nigerian National Petroleum Corporation earned revenue of N4.61tn and spent N4.52tn in 2020, according to a report released on Friday.
The report, titled ‘2020 NNPC Annual Performance Review’, was developed by BudgIT in partnership with Oxfam.
According to the organisations, NNPC’s revenue in 2020 showed a 23.8 per cent decrease from the N6.05tn it earned in 2019.
The report said, “The expenditure of all its subsidiaries stood at N4.52tn. Total crude oil production suffered an 11.61 per cent decrease, from the 734.27 million barrels produced in 2019 to the 649.00 million barrels produced in 2020.
“Pipeline breaks, a key cause of oil revenue leakage and production loss, had a 70.28 per cent decline from 1,484 breakpoints in 2019 to 441 breakpoints in 2020. Likewise, a corresponding 57.87 per cent decline in NNPC’s spending on pipeline maintenance costs was recorded as it plummeted from N126.66bn in 2019 to N53.36bn in 2020.”
According to the report, NNPC’s ailing refineries, led by Kaduna Refining and Petrochemical Company, wiped out a total of N100.03bn from the corporation’s revenue in 2020, despite past announcements of investments in turnaround maintenance.
“Also, despite announcing a deal to boost PHRC’s performance through a colocation agreement with Maire Tecnimont SPA a few years ago, the Federal Executive Council recently approved another $1.5bn for a rehabilitation exercise of the PHRC,” it said.
The report noted that the global oil and gas industry faced the twin shocks of the oil price crash and the COVID-19 pandemic last year, influencing demand and supply of crude oil and plunging Nigeria into its second recession in six years.
It said the amount the NNPC claimed as crude oil losses rose by 35.33 per cent from N3.46bn in 2019 to N5.35bn in 2020, while NNPC’s product losses declined from N32.96bn in 2019 to N15.71bn in 2020.
According to the report, NNPC has struggled to keep its refineries operating profitably.
It said in 2020, the refineries were out of operation, adding that the last time the refineries were in operation was July 2019.
They added that in the 2020 financial year, the refineries in Kaduna, Port Harcourt, and Warri incurred a cumulative loss of N100.39bn and accumulated a total deficit of N486.54bn between 2016 and 2020.