Thursday, July 15, 2010

Nigeria denies state oil firm NNPC bankrupt

The Nigerian government has strongly denied claims that the state oil company is bankrupt, shortly after a junior minister said it was insolvent.

On Tuesday, Junior Finance Minister Remi Babalola said the Nigerian National Petroleum Corporation was unable to pay debts of $5bn (£3.3bn).

However, two senior cabinet ministers flatly contradicted him.

Nigeria is a major producer and exporter of crude oil but depends almost entirely on imported fuel.

Finance Minister Segun Aganga told journalists the NNPC was a going concern and an important arm of government.

Information Minister Dora Akunyili also rejected the comments.

The NNPC has also denied the claim but said it was struggling because of the government's failure to pay billions of dollars of subsidies.

The BBC's Caroline Duffield in Lagos says it is not clear why the money has not been paid, but there are now talks between the government and the NNPC to try to resolve the problem.

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