December 9, 2018

Petrol: FG moves to avert strike, to pay marketers N236billion subsidy money


By Emeka Anaeto, Udeme Akpan, Sebastine Obasi & Michael Eboh

The Federal Government, yesterday, said it would pay oil marketers N236 billion next Friday, being first tranche of the outstanding N348 billion subsidy claims owed members of the Major Oil Marketers Association of Nigeria, MOMAN, and the Depot and Petroleum Products Marketers Association, DAPPMA.


Speaking after a meeting with officials of petroleum product marketers in Abuja, Chief Operating Officer, Downstream of the NNPC, Mr. Henry Ikem-Obih, disclosed that the remaining portion of the claims would be paid in 2019, after a meeting between the oil marketers and the Federal Ministry of Finance, that would be scheduled sometimes in 2019.

The meeting was convened  after the marketers threatened last week to go on strike if within seven days, efforts were not made to pay the debts.

Ikem-Obih said: “We agreed that after the first tranche is paid, the marketers would form a committee to work on details of how the next tranche will be paid in 2019 and the last tranche in 2020. Government is fully committed to pay the first tranche as promised and will be paid through promissory note that would be issued by the Debt Management Office, DMO.”

According to him, the Federal Government had insisted on making the payments through promissory notes, which was equivalent to cash and could be liquidated almost immediately.

He said the decision to pay through promissory notes was based on the need to manage cash injection into the economy, noting that injecting cash of that magnitude into the economy might affect the country negatively.

The NNPC downstream boss said the mode of settlement had been agreed between the Federal Government and the oil marketers since 2017, adding that the decision was not new.

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He noted that the Federal Government had decided to pay the money to the oil marketers in full and had directed that there would be no deductions from the marketers’ account to settle debts owed government.

Ikem-Obih said, “Some oil marketing companies, DAPPMA and MOMAN members are indebted to Federal Government agencies, like the Federal Inland Revenue Service, FIRS, but the government had directed that the debts should not be deducted from the payments. This is because if we do, most of the marketers would be left without a dime.”

Explaining the disparity between the N800 billion claimed by the oil marketers and the N348 billion approved by the National Assembly, the downstream chief executive said the debt position of all the marketers to the government where considered and agreed upon as at June 30, 2018 and presented to the National Assembly for approval, which after consideration of the debts, approved the sum of N348 billion.

He assured Nigerians that the NNPC was fully ready to ensure stable supply of petroleum products during the Yuletide period and beyond, stating that presently, the corporation has over 2.8 billion litres of Premium Motor Spirit, PMS, also known as petrol, which would last the country for 55 days while 90,000 metric tonnes of diesel, imported by the Petroleum Products Marketing Company, PPMC, and NNPC Retail, would arrive the country in the next couple of days.

Ikem-Obih declared that all MOMAN, DAPPMA and IPMAN had assured the Federal Government that their facilities would be available throughout the festive period, while all the NNPC depots across the country and its 618 retail outlets would also be dispensing the products.

He also disclosed that in addition to the imported fuel stock, the countries refineries would also be contributing to fuel supply, adding that Warri Refinery had returned to production last Thursday, while Port Harcourt refineries are about to resume production.

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Also speaking, Chief Executive Officer of A.A. Rano Limited, Alhaji Aliyu Sa’id dissociated the company from the planned shutdown by DAPPMA and MOMAN, stating that the timing was wrong.

He said oil marketers should not be seen to be sabotaging the efforts of government in ensuring stable fuel supply during the Yuletide season and beyond.

Speaking in the same vein, Managing Director/Chief Executive Officer of A.Y.M. Shafa, Mr. Ahmad Abdullahi, declared that at this time that the country is going through series of challenges, security and financial, any attempt to worsen the plight of Nigerians would be seen as an attempt to put the country in chaos.

He urged other oil marketers to support the Federal Government and trust the decisions of the government as it concerns settlement of the outstanding claims.

On his part, Group Managing Director of Obat Oil and Gas, Prince Akinfemiwa Akinruntun, said the company is ready to support the government by loading the products on a 24 hours basis, noting that the NNPC had been supportive of oil marketers over the years.

He noted that national interest supersedes his personal interest, hence, he would urge Nigerians to avoid panic buying, as efforts would be geared towards ensuring stability in petroleum products supply.