The Federal Government has explained how Nigeria’s Excess Crude Account fell from $72.4 million to $35milion in a space of one year despite crude oil averaging higher than Nigeria’s benchmark for the year.
This was addressed by Tolu Ogunlesi, Special Assistant to President Muhammadu Buhari on Digital and New Media on Friday evening in a response to a Nairametrics article on the current figure of the ECA.
The ECA is a savings account retained by the Federal Government and is funded by the difference between the market price of crude oil and the budgeted price of crude oil as contained in the appropriation bill.
What Ogunlesi is saying
In defence of the Buhari administration, Ogunlesi said attempted a breakdown of how much and for what purpose has been spent from the ECA.
He said, “For those pointing out ECA was $2.1B in 2015, keep in mind $1 billion went to security purchases (incl 12 Super Tucano)
“Part went to Paris Club Refunds to States and a substantial portion invested into the Sovereign Wealth Fund/NSIA.”
The President’s aide also noted that the ECA was once $20 billion in 2009 before depleting to $2 billion in 2015.
The Excess Crude Account was created to deal with surplus earnings from crude oil sales against the budgetary benchmark. Brent’s 2021 annual average of $71 per barrel is the highest in the past three years, and the Nigerian Government had a budget benchmark of $57 per barrel in 2021.
In case you missed it
Nairametrics earlier reported that in a presentation delivered by the Honorable Minister of State for Budget and National Planning, Prince Clem Agba during the 122nd physical meeting of the National Economic Council in Abuja, it was disclosed that Nigeria’s Excess Crude Account stands at $35,868,086.40 as at 17th January 2022.