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Tag: oil marketers

  • Import licence: Oil marketers ask court to dismiss Dangote Refinery’s suit 

    Import licence: Oil marketers ask court to dismiss Dangote Refinery’s suit 

    Three oil marketers have prayed a Federal High Court in Abuja to dismiss a suit filed by Dangote Petroleum Refinery and Petrochemicals.

    The oil marketers, in a joint counter affidavit marked: FHC/ABJ/CS/1324/2024 filed in response to Dangote Refinery’s originating summons, told Justice Inyang Ekwo that granting that application would spell doom for the country’s oil sector.

    According to them, the plan to monopolise the oil sector is a recipe for disaster in the country.

    The three marketers; AYM Shafa Limited, A. A. Rano Limited and Matrix Petroleum Services Limited, in their response, said the plaintiff did not produce adequate petroleum products for the daily consumption of Nigerians.

    Besides, they argued that there was nothing placed before the court to prove the contrary.

    The News Agency of Nigeria (NAN) reports that Dangote Refinery had sued Nigeria Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) and Nigeria National Petroleum Corporation Limited (NNPCL) as 1st and 2nd defendants.

    Also listed as 3rd to 7th defendants respectively in the originating summons dated Sept. 6 are AYM Shafa Limited, A. A. Rano Limited, T. Time Petroleum Limited, 2015 Petroleum Limited, and Matrix Petroleum Services Limited.

    The company had prayed the court to declare that NMDPRA was in violation of Sections 317(8) and (9) of the Petroleum Industry Act (PIA) by issuing licenses for the importation of petroleum products.

    It stated that such licenses should only be issued in circumstances where there is a petroleum product shortfall.

    It also urged the court to declare that NMDPRA is in violation of its statutory responsibilities under the PIA for not encouraging local refineries such as the company.

    But the marketers, in their response filed on Nov. 5, told the court that they are well qualified and entitled to be issued import licence by NMDPRA to import petroleum products in Nigeria within the meaning of Section 317(9) of the PIA.

    They argued that vesting Dangote Refinery with the power of monopoly in Nigeria’s petroleum industry as it sought vide the instant suit, would kill competitive pricing of petroleum products in the country.

    They said that such act would further deteriorate the country’s critically ailing economy “and unleash untold hardship on Nigerians, all of which constitute a recipe for disaster in the polity. “

    They said if Nigeria puts all her energy eggs in one basket by stopping importation of petroleum products and allowing the plaintiff to be the sole producer and supplier of petroleum products in Nigeria, with liberty to determine the prices at which it supplies the products, the prices of petroleum products will continue to rise and energy security will elude Nigeria.

    “That in the event of any breakdown in or obstruction to the production chain of the plaintiff which stops it from producing, Nigeria will be thrown into energy crises because it does not have the reserves that would last it for at least 30 days that it would need to order, pay for, freight and import refined products into tanks in Nigeria.

    “That amidst the glaring absence of any credible and demonstrable proof that the plaintiff refines and supplies adequate petroleum products for the daily use/consumption of Nigerians, is a recipe for disaster in Nigeria’s energy sector.”

    Read Also: JUST IN: Dangote Refinery hits IPMAN, PETROAN, reveals price of petrol per litre

    They further told the court that granting the reliefs sought by the plaintiff was a design to leave Nigeria and Nigerians at the mercy of the plaintiff with respect to availability and cost of purchasing petroleum products in the country.

    They equally argued in their reply that they are fully qualified for the issuance of the import licences issued to them by the 1st defendant, as they duly met all the legal requirements for the issuance of such import licences, before same were issued to them.

    “The import licences lawfully and validly issued to the defendants did not in any way whatsoever, cripple the plaintiff’s business or its refinery.

    “The import licences issued to the defendants by the 1st defendant are in line with the provisions of Petroleum Industry Act, 2021, the Federal Competition and Consumer Protection Act, 2018 and other relevant laws,” they told the court.

    Justice Ekwo had fixed Jan. 20, 2025 for report of settlement or service.

    (NAN)

  • House to intervene in oil marketers, govt feud

    House to intervene in oil marketers, govt feud

    Speaker of the House of Representatives, Hon. Abbas Tajudeen said yesterday that the parliament would intervene on the issues between the Federal Government and petroleum marketers regarding allocation and debt.

    The assurance came just as Independent Petroleum Marketers Association of Nigeria (IPMAN) accused the NNPC Limited of abuse in the petrol sharing formula.

    Speaker Abbas who spoke when officials of IPMAN visited him said l the Majority Leader of the House, Prof. Julius Ihonvbere will chair a panel that would engage relevant stakeholders on the issues affecting the supply chain of Premium Motor Spirit (petrol) in Nigeria.

    He said the House appreciate the critical roles oil marketers play in the economy, ensuring energy supply, particularly in the wake of the bad road and insecurity across the country.

    He also said he was aware of the difficulties being faced by IPMAN concerning price fluctuations, urging them to be patient as the current government meant well for the association.

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    He also noted that he was aware of the challenge concerning allocation of PMS supply by the national oil firm, Nigerian National Petroleum Company Limited, formerly Nigerian National Petroleum Corporation.

    “The House, I assure you, will take the necessary steps,” the Speaker stated, adding that all the stakeholders in the sector would be invited on the issues.

    Speaker Abbas also said the issue of the over N200bn non-payment by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) to members of IPMAN would be sorted out soon.

    “We want to plead with you to please slow down; to please soft pedal on your planned strike,” Speaker Abbas said, while assuring the association that the House would step into the matter.

    “The issue of industrial action should be suspended. It should be the last resort,” he added.

    Speaking earlier, President of IPMAN, Alhaji Abubakar Shettima decried the alleged abuse of the petrol sharing formula by the NNPC.

    Shettima said the original allocation formula was for IPMAN to have 50 per cent, Major Oil Marketers Association of Nigeria to receive 30 percent, while the NNPC was to retain 20 per cent.

    He stated that IPMAN, with the over 150,000 outlets owned by its members, was capable of ensuring adequate supplies to the nooks and crannies of the country.

    The IPMAN president also alleged that the NMDPRA owed the association’s members about N200billion, which he pleaded with the Speaker to intervene on.

  • Major oil marketers rally tanker drivers for smooth operations

    Major oil marketers rally tanker drivers for smooth operations

    Fuel marketers under the aegis of Major Energies Marketers Association of Nigeria (MEMAN) have assured tanker owners of a cordial relationship to ensure smooth lifting of  petroleum products.

    The group, in a statement signed by its Executive Secretary, Mr Clement Isong, on Tuesday in Lagos  said that individual marketers are currently in discussions with their transporters for fair rates of lifting products.

    The News Agency of Nigeria (NAN) reports that the National Association of Road Transport Owners (NARTO) and the Petroleum Tanker Drivers (PTD) had initiated strike action on Feb. 19.

    NARTO had requested that oil marketers review the freight rates after the deregulation of the downstream sector.

    Isong said: “There’s no conflict between our members and the transport unions. Individual marketers are in discussions with their transporters for fair rates, adhering to the Petroleum Industry Act and FCCPC Act, which prohibits jointly setting rates.

    “Pump price deregulation promotes healthy competition, encouraging cost-reduction measures for better customer value. It’s a gradual process that requires time for full price recovery and market competition.

    “All stakeholders, including operators and MDAs, must collaborate to optimise the supply chain for affordability amid the challenging environment.

    “MEMAN and its members recognise the industry’s complexities and commit to sustainable solutions in cooperation with relevant stakeholders.”

    Meanwhile, queues for petrol have resurfaced in some parts of Lagos following the strike action.

    Some of the filling stations on Ikorodu Road; Bank Anthony Way, Ikeja;  Bariga;  Mushin and Ojota were besieged by customers, while many were rationing products, selling with either one pump or two.

    Others have shut their stations due to lack of products.

    NAN also recalls that on Feb. 6, NARTO made a passionate appeal to the Minister of State for Petroleum, Heineken Lokpobiri, to urgently intervene by addressing some of the challenges confronting the organisation regarding the transportation of petroleum products across the country.

    According to the letter which was signed by NARTO’s President, Yusuf Othman, one of the most pressing issues affecting the industry is the decreasing revenues due to rising operational costs and persistently low freight rates.

    Read Also: Oil marketers seek govt’s intervention to stabilise industry

    Under this proposed system, Othman said that transporters would be required to pay a sum of N15,000 to the system operator, further burdening an already strained financial industry.

    “Moreover, there are growing concerns that other states along critical road corridors may follow suit and introduce similar charges to boost their internally generated revenue (IGR).

    “Lagos, Ogun, and Oyo states charge an exorbitant N180,000 per truck each time a tanker breaks down or parks on their highways,” Othman said.

    According to him, this additional financial burden has threatened to push transporters to the brink, potentially leading to widespread disruption in petroleum product distribution.

    (NAN)

  • How oil marketers, five others diverted $8.4m AGO, by witness

    An Ikeja Special Offences court heard yesterday how two oil marketers – Osahon Asemota and Yusuf Yahaya Kwande – allegedly connived to steal Automotive Gas Oil (AGO) worth $8.4 million belonging to NADABO Energy Limited sometime in October 2008.

    A witness of the Police Special Fraud Unit (SFU), Chief Emefo Etudo, narrated how the product was diverted while giving evidence before Justice Mojisola Dada.

    The marketers are facing a three-count criminal charge with five companies – Trafigura Behee BV, Trafigura PTE Limited, Mettle Energy and Gas, Rembrandt Limited and Jil Engineering and Oil Services Limited – bordering on conspiracy, stealing, and receiving stolen property.

    Led in evidence-in-chief by Economic and Financial Crimes Commission (EFCC) prosecutor, Rotimi Jacobs (SAN), Etudo said the script of stealing 6.4 metric tonnes of AGO worth $8.4 million was well acted and executed by the defendants.

    He told the court that he had acted as a solicitor to Renbrandt and was deceived by Asemota to believe that the product was contaminated while he acted as his client.

    According to him, the cargo was not contaminated as being claimed by Renbrandt Limited, stressing that claims that the cargo was contaminated was a lie to deceive Nadabo Energy Limited and Spring Bank PLC.

    Etudo said was appointed by Nadabo to find out what happened to his cargo.

    He said: “He gave me power of attorney which was made before a commissioner of oath. I applied to the Corporate Affairs Commission (CAC) to know the status of directorship of the defendant companies.

    “We saw a charter part agreement, bill of lading of October 2008. Based on these two documents, it became clear that Trafigura supplied the cargo at offshore Cotonou and the cargo made its way into Nigeria territorial water.

    “The vessel, named MT Ozay 6, took the products to Lagos. They use MT Efeomo to carry out their stealing of cargo. Claims by the defendants that the vessel was in Cotonou in October was false. What they did so that the vessel will not be traced or tracked by Lloyd’s Intelligence of UK is that they switched off the transponder that was installed in it. By switching off the transponder, the vessel movement will not be known.”

  • Oil marketers order shutdown of depots over N800b subsidy debts

    DEPOT and Petroleum Products Marketing Association (DAPPMA) yesterday directed its members to shutdown services as from 12 midnight.

    A directive from the DAPPMA Executive Secretary, Mr. Olufemi Adewole, sent to members, said the association’s efforts to make the Federal Government pay its N800 billion subsidy debts were not successful.

    But, the news came as oil workers  sought a quick resolution of the disagreement between the Federal Government and oil marketers over the outstanding fuel subsidy claims.

    The oil workers, under the aegis of Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) and the Nigerian Union of Petroleum and Natural Gas Workers (NUPENG), said the resolution would avert another fuel crisis.

    Adewole, however,  said the association “took the bold step to stop the financial hemorrhage of its members by the painful disengagement of its loyal workforce after three years of engaging the Federal Government in its efforts to secure the payment of all subsidy induced debts owed marketers”.

    The DAPPMA  Executive Secretary said efforts  made till date have not yielded the desired results, hence the decision to shut down the depots.

    He said the association duly notified the Federal Ministry of Finance, the Debt Management Office (DMO) and the Presidency of its challenges in paying workers’ salaries beyond last month.

    He added that the association pleaded with the Presidency, DMO and the ministry to no avail to pay the outstanding debts like subsidy, interest, forex differentials with summation calculated up to 31st of this month.

    Adewole said as a result of the notice, the association was invited to meetings.

    His words: “Further talks to which we are usually invited, which now seem to be their response to follow ups on these debts, never consented to our requests for full cash payment of these debts, hence the regrettable decision we have had to take to let go our loyal staff, who we have sustained through bank facilities at outrageous interest rates.”

    The DAPPMA Executive Secretary added: “Premised on our inability to pay December 2018 salaries and to avoid owing staff for work done without any hope of pay, it is hereby agreed that, since our staff have been disengaged, all DAPPMAN member Depots are not in a position to operate and hence will shut down all loading operations at midnight, Sunday December 9, 2018, until Federal Government pays our calculated claims: the remaining subsidy (to few members), forex differential interest incurred up to December 31, 2018.

    “This decision is binding on all members of the association and full compliance is expected of every member company of the association. The association shall revert in the same vein with any other directives as might be deemed necessary.”

    Oil workers’ leaders yesterday assured that their interests are aligned with Nigerians.

    They spoke while addressing reporters after a meeting with officials of the Nigerian National Petroleum Corporation (NNPC) and its subsidiary, the Petroleum Products Marketing Company (PPMC), as well as Major Oil Marketers Association of Nigeria (MOMAN) and DAPPMA).

    PENGASSAN National President Comrade Francis Johnson, who spoke on behalf of the oil workers, said the association intervened in the crisis to protect the interest of its members as well as that of the country.

    According to him, “PENGASSAN, as one of the major stakeholders in the oil and gas industry, we are concerned. We are also looking at it that the year is coming to an end; they are also talking about 2019 politics and elections. We do not want to do anything to overheat the polity and make Nigerians go through a lot of stress.

    “For us, we have said and we are aware that there have been series of meeting to resolve the issue. We stand by that and we appeal to both government and the oil marketers to look at the larger interest of Nigeria and do what is needful for Nigeria to grow from strength to strength.

    “I believe in the commitment and sincerity of both parties to reach an amicable solution to the issue. I believe that both parties would allow the larger interest of Nigeria to supersede. I advise them to fast-track every process to resolve this issue and make sure they keep to the terms of agreement reached.”

    He expressed concerns that if not resolved amicably, the subsidy debt issue might lead to the sack of its members by the oil marketers.

    However, he cautioned its members against joining any strike action not called by the leadership of the unions.

    NUPENG National President Comrade William Akporeha assured Nigerians that there would be an unhindered distribution of petroleum products during the Yuletide, as all his members would not be embarking on any strike.

    He said: “This regime of NUPENG believes in dialogue. Until we are pushed to the wall, we do not take strike as the first option. So far, between now and December ending, I can assure Nigerians that there won’t be shortage of petroleum products in our streets.”

    On his part, PTD National Chairman Comrade Salimon Oladiti said: “We are trying to mediate in the crisis between the Federal Government and the oil marketers. We are major players in the distribution of petroleum products, but at the same time, we have gotten assurances from the Federal Government that between now and Friday, December 14, 2018, part of the money owed the oil marketers – about 50 per cent of the money – would be paid to them.

    “We do not want to issue threats, but we are losing our members; because if these marketers carry out their threats, we are going to be seriously affected.”

    PPMC Managing Director Mr.  Umar Ajiya, however, warned that the Federal Government would not tolerate any attempt by any individual or group to disrupt the distribution of petroleum products during the Yuletide.

    He stated that such actions would be seen as economic sabotage.

  • N800b subsidy debt: Oil marketers give Fed Govt 7-day ultimatum to pay cash

    OIL marketers yesterday gave the Federal Government a seven-day ultimatum to pay them  N800 billion.

    They threatened to wind up operations at the depots across the country should the government fail to settle them.

    According to them, the government should pay the arrears in cash and not as promissory note.

    The marketers, comprising Major Oil Marketers Association of Nigeria (MOMAN), Depot and Petroleum Products Marketers Association (DAPPMA) and Independent Petroleum Products Importers (IPPIs), said they would force their members to disengage workers from depots after the expiration of the ultimatum.

    Confirming the development, IPPI’s legal adviser Patrick Etim claimed that the investments and assets of oil marketers have been taken over by banks of unpaid debts.

    Etim said that marketers have no choice than to ask their memers to stay at home over unpaid salary arrears due to huge subsidy debts owed by the government.

    He said: “The only way to salvage the situation is for government to pay the oil marketers the outstanding debts through cash option instead of promissory note being proposed.

    “As I speak, nothing has been done several months after assurances received by government saying it would pay off the outstanding debts.

    “The oil marketers have requested that forex differential and interest component of government’s indebtedness to marketers be calculated up to December 2018 and be paid within next seven days from the date of the letter sent to the government.’’

    Etim said that several thousand jobs were on the line in the industry, as oil marketers began cut-down of their workforce due to inability to pay salaries

    “At the inception of the current administration, marketers engaged the government with the view to secure approval for all outstanding subsidy-induced debts handed over to the current administration.’’

    The counsel said that the current administration paid part of the debts with a substantial portion of the subsidy interest and foreign exchange differential still pending.

    DAPPMA’s Executive Secretary Olufemi Adewole also confirmed the issuance of notice.

    Adewole disclosed that oil marketers, on November 28, served the ultimatum letter on the Debt Management Office (DMO), Finance minister, Chairman, Senate Committee on Petroleum Downstream, Department of State Services (DSS) and Minister of State for Petroleum Resources.

    The DAPPMA spokesman said: “We urge the DMO to process and pay marketers in cash for their outstanding forex differentials and interest component claims, together with the amount already approved by the Federal Executive Council (FEC) and the National Assembly.

    “Marketers are not in a position to discount payment on the subsidy-induced debt owed as proposed by DMO.

    ”The expected payment is made up of bank loans, outstanding admin charges due to PPPRA, outstanding bridging fund due Petroleum Equalisation Fund (Management) Board and in a few cases AMCON judgment debts.

    “We urge that the Federal Executive Council (FEC) approved payment instrument, (the promissory note) be substituted with cash and paid through our bankers to stop the avoidable waste of public funds through these debts accruing interest.’’

    DAPPMA also urged all institutions involved in resolving the lingering problem to appreciate the situation marketers faced and expedite payment of the debts in full without further delay.

  • Oil marketers fret over assets forfeiture to banks

    Oil marketers have started re-negotiating with banks over the terms of the facilities they took from the lenders.

    This followed moves by lenders to take over the assets they used as collaterals for obtaining the facilities to import fuel, it was learnt at the weekend.

    The oil marketers include members of Major Marketers Association of Nigeria (MOMAN), Independent Petroleum Marketers Association of Nigeria (IPMAN), and Depots and Petroleum Products Marketers of Nigeria (DAPMAN).

    It was gathered that the marketers have been visiting the directors of some of the banks to ask for more time as they await the Federal Government, which has promised to pay them subsidies amounting to about N800 billion, through which they intend to settle the debts.

    Industry sources said many of the marketers have been holding meetings with some banks’ chief executives on the issue, adding that some of them have acquiesced to the demand for extension.

    DAPMAN’s Executive Secretary, Mr Femi Adewole, affirmed this, saying marketers were looking for means of protecting their assets, adding that the banks were tired of taking excuses on the issue.

    Adewole said the development was expected, as marketers had no other means of running their operation, except through facilities, such as depots, fuel retail outlets and other highly valued equipment

    He said some marketers were still negotiating with banks, while others have concluded theirs.

    He refused to mention the names of the affected banks, saying the issue would further strain the relationship between the banks and the marketers.

    Speaking at the weekend, he attributed the development to the wrong signal, which the government sent to the public on the payment of subsidy arrears owed the marketers.

    Adewole said: “After the meeting among the Federal Executive Council, Debts Management Office (DMO), Central Bank of Nigeria (CBN), Product Petroleum Pricing and Regulatory Agency (PPPRA), House of Representatives’ Committee on Downstream Sector and marketers that the government is paying the subsidy arrears in both  promissory notes and cash, banks misconstrued the issue.’’

    “Banks thought the marketers have collected their monies and are not ready to pay back their debts. This made them to approach courts for injunctions to restrain marketers from using their facilities, which they eventually got. I am aware of two depots that have been seized by banks, as a result of the news that frittered to town that marketers have been paid subsidies owed them by the government.”

    According to him, marketers are sensing dangers and not ready to leave anything to chance, hence the moves by them to try and stop banks from carrying out further raids on their assets.

    He said the decision by the government to pay the debts in promissory notes does not show sincerity, adding that marketers have to go back to banks discount the promissory notes, and waste more time in the process.

  • Fed Govt rushes to settle oil marketers

    The Debt Management Office (DMO) is accelerating the implementation of the Promissory Note Programme and Bond Issuance to settle inherited local debts and contractual obligations due to various categories of creditors, including oil marketers.

    The measure is intended  to stave off any intended
    confrontation with oil
    marketers and other creditors, a statement from the DMO has said. It added that the Programme will be implemented in accordance with the process approved by Federal Executive Council (FEC).

    According to the statement, “the claims by oil marketers are for accrued interest and foreign exchange differentials,” pointing out that whilst some of the issues involved in the implementation of the Programme have been explained to representatives of the oil marketers, the DMO nevertheless, has invited the oil marketers to a meeting this week to explain the process to them and provide a status report.

    FEC approved the establishment of the Promissory Note Programme and Bond Issuance to settle inherited local debts and contractual obligations due to various categories of creditors, including oil marketers in July 2017.

    These represent unpaid obligations carried over from previous administrations.

    The DMO said “the amounts presented to FEC and subsequently to the National Assembly, were derived by simply collating figures from various MDAs in order to kick-start the process.”

    However, given that these were largely unverified amounts, the DMO explained that “it became prudent on the part of Government to include processes that would be adopted in the implementation of the Programme that would ensure transparency and Value for Money before the Promissory Notes are issued.”

    One of such processes is the validation of the amounts against each creditor by an International Accounting Firm operating in Nigeria.

    “Based on the approval by FEC, the DMO initiated steps towards the implementation of the Programme, one of which is the appointment of advisers using the provisions of the Public Procurement Act, 2007” the release said.

     

    However, since the Programme involves the issuance of Sovereign debt instruments, which require the approval of NASS, as provided in the Fiscal Responsibility Act, 2007, there was a limit to what the DMO could do without a NASS approval. The required NASS approval was only received on September 26, 2018 through a letter from the Clerk of the National Assembly.

  • Fed Govt moves to settle oil marketers

    The Federal Government has commenced the process of paying oil marketers the arrears it owes the marketers.

    A statement from the Debt Management Office (DMO) last night stated that it has “commenced the accelerated implementation of the Programme in line with the process approved by the Federal Executive Council (FEC).

    The approved process the DMO revealed will be through the issuance of promissory notes to the oil marketers.

    The DMO also indicated that it would meet with the oil marketers in November 2018.

    The obligations due to the oil marketers represent interest accruals and foreign exchange differentials.

    The DMO explained that “the government of President Buhari, as one of its strategies to address inherited arrears to various contractors, approved the issuance of Promissory Notes to various categories of creditors.”

    “After the approval by the Federal Executive Council (FEC), the President presented a request to the National Assembly, as required by the Fiscal Responsibility Act, 2007. The categories of creditors for whom the settlement of arrears was approved by FEC include pensioners and staff, contractors, construction companies, exporters, DisCos, GenCos, State Governments, Judgement Debts, as well as the petroleum marketers.”

    To ensure Transparency and Value for Money to the Federal Government in the settlement of these arrears, the FEC had specified the processes to be adopted in the issuance of the Promissory Notes, one of which is the validation of the claims by an International Accounting Firm operating in Nigeria.

    The benefits of this initiative by the Buhari Administration include “the return by contractors to project sites, thereby improving infrastructure and creating jobs. Another benefit is that there would be an improvement in the ability of banks to lend to the real sector, since some of the creditors to be settled are indebted to banks and the issuance of the Promissory Notes will enable them to repay their debts to the banks.”

    To arrive at the decision to expedite the settlement of oil marketers arrears, the DMO in its statement said “the Senate Committee on Downstream Petroleum Sector called a meeting of stakeholders on Wednesday, October 31, 2018 to discuss the issue of the outstanding payments to oil marketers. At the meeting were the Federal Ministry of Finance, the Debt Management Office (DMO), the Central Bank of Nigeria (CBN), the Petroleum Products Pricing Regulatory Agency (PPPRA) and representatives of oil marketers.”

    The Chairman of the Senate Committee, Senator Kabiru Marafa, was said to have he called the meeting to ascertain the status of the implementation of the approvals given by the National Assembly for the settlement of arrears to oil marketers.

    The Committee also requested the Central Bank of Nigeria (CBN) “to confirm the position on a statement by oil marketers that there was an agreement to stop the accrual of interest on loans owed by the oil marketers to banks.”

    The Senate Committee had earlier approved an amount to be paid to the oil marketers in July 2018, but the complete approval of the National Assembly, required by law for the issuance of Government Debt Securities, was only received when a resolution conveying the approval of the House of Representatives was issued on September 26, 2018.

    “On the strength of the provisions of the law, therefore, implementation could not have commenced prior to September 26, 2018” the DMO said.

  • N650b debt: Oil marketers urge speedy payment

    Oil marketers have appealed to the Federal Government to hasten payment of the over N650 billion fuel imports subsidy arrears owed them (marketers) over the years to save their assets from being taken over by banks.

    The marketers, under the aegis of Major Oil Marketers Association of Nigeria (MOMAN), Depot and Petroleum Products Marketers Association (DAPPMAN), Independent Petroleum Products Importers (IPPIs) and Independent Petroleum Marketers Association of Nigeria (IPMAN) made the appeal in Lagos.

    The Executive Secretary of DAPPMAN, Olufemi Adewole, who spoke on behalf of the marketers, urged the government to lessen the bureaucracy involved in the payment process.

    Adewole said the inability of the Federal Government to pay the debt has resulted to massive job losses in the downstream subsector of the oil and gas industry, and affected the marketers’ business operation.

    Adewole said that 60 per cent of marketers have been forced out of business as banks have taken over their depots, assets and properties due to their inability to pay back monies borrowed to import fuel.

    He said many marketers were forced out of business, while others are struggling to survive due to the government’s inability to settle the subsidy arrears, saying the development is threatening investment in the downstream subsector.

    The DAPPMA N scribe said, although, the Federal Government has earmarked money to clear the debts, the marketers were yet to be paid.

    “The debt has had very adverse effects on our operations. I am aware of two depots that have been forcibly taken over by banks because they got injunctions from the courts. They did so the moment they heard that the National Assembly approved payment of the debt to marketers. Unfortunately, as at September 27th 2018, the money was yet to get into our accounts.”

    He said the other challenge is that many of the marketers have laid off more than 90 per cent of their staff because of financial constraints.

    Adewole however said that the government has promised that part of the money would come as promissory note and cash saying the information gathered was that the government may pay only in promissory note. It means you have to go back and discount this promissory note in the bank. This means we are losing because the money has been delayed and this adds to the interest to be charged on our accounts.

    He said the interest came about as a result of devaluation of the naira from N197 to N285 a dollar, adding that what was approved for payment is not the actual amount the government owed.

    An independent marketer urged the government to deregulate the downstream sector, adding that deregulation would curb the huge amount of money spent on subsidy. According to him, marketers have run out of cash and their businesses are gradually going moribund.

    “No marketer can import petrol with the present price differential. We cannot buy fuel at N174 per litre at the international market and sell at N145 without being paid the differentials. The NNPC imports fuel and uses its discretion to allocate products to marketers, adding that if the subsector is deregulated it would also help government to invest the subsidy money into other sectors.

    The Chairman of South-West Chapel of the Nigeria Union of Petroleum and Natural Gas Workers (NUPENG), Mr. TayoAboyeji, said loading activities had been bad at most private depots. He attributed the situation to inability of marketers to import petroleum products.

    He added that some depots have to convert their workers into contract staff. “Government should find a way to pay the marketers and deregulate the subsector to allow more players into the industry,” he added.