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NLNG pays FG lowest dividend in 10 years

By on March 7, 2017

Dividend payments to the federal government for its 49 per cent stake in the Nigeria Liquefied Natural Gas (NLNG) has dropped to its lowest since 2007, Daily Trust reports.

The NLNG which is owned by four shareholders: the federal government, represented by the Nigerian National Petroleum Corporation (NNPC; 49 per cent) Shell Gas (25.6 per cent), Total (15 per cent) and Eni (10.4 per cent) produces LNG as well as natural gas liquids for export.

A publication of the company’s financials obtained by our reporter showed that dividend payments to the government fell by $687.6 million or 65.8 per cent from $1.04 billion in 2015 to $365.1 million in 2016, the lowest in ten years.

In 2008 the NLNG paid $2.6bn, $848.6m in 2009, and $1.4bn in 2010 as dividends. Payments rose to $2.5bn in 2011 and $2.7bn in 2012 before sliding to $1.2bn in 2013 and $1.3bn in 2014.

Managing Director of the company Mr. Tony Attah admitted that 2016 financial year was tough as the market was down.

“People will think it was only oil price that was down. Gas price was down as well” Attah told journalists in Abuja recently.

Meanwhile, the Group General Manager, NNPC Capital, Mr. Godwin Okonkwo while confirming the latest payment to our reporter said the corporation no longer receives the funds.

“It goes straight to the CBN; we just keep record,” he said.

Remittances of dividends, tax and other payments by the NLNG to the federation through NNPC have in the past caused ripples.

For instance, some of the accusations against the NNPC include a recent NEITI audit which says that while NLNG paid around $1.289bn as the dividend in 2013 NNPC acknowledged receipt but did not remit it to the federation. Also previous explanations by the NNPC were that it reinvests the funds in some of its other gas projects were challenged by many Nigerians.

However, Okonkwo said before NNPC spend anything, it gets presidential approval. “Every kobo spent out of that account must have presidential approval.”

Daily Trust also discovered that apart from the $356 million NLNG dividend payout for 2016, the Nigerian federation also enjoyed other payments in form taxes, fees and levies whose value also dropped.

Income Tax/Education Tax payment by the company dropped to $323.2m from $2.1bn in 2015; With-holding Tax fell from $222.4m to $85.2m; taxes to states and local government also lowered to $1m from $2.1m in 2016.

Regulatory fees to government agencies also fell to $23.7m from 34.4m in 2015 while payment for local contracts for goods and services also shrank from $610.8m to $565.6m in the previous year.

 

 

[DailyTrust]