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, Mr. Olufemi Adewole, who spoke on behalf of the marketers, also urged the government to lessen the bureaucracy involved in the payment process.
Adewole said the inability of the Federal Government to pay the debt had resulted to massive job losses in the downstream subsector of the oil and gas industry and had affected the marketers’ business operation.
Adewole said that 60 per cent of marketers had been forced out of business as banks had taken over their depots, assets and properties due to their inability to pay back monies borrowed to import fuel.
According to him, many marketers were forced out of business, others struggling to survive due to the government’s inability to settle the subsidy arrears. The development, he said, had been threatening investment in the downstream subsector.
The DAPPMAN chief said, although, the Federal Government had earmarked money to clear the debts, yet the marketers had not been 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 is yet to get into our accounts.
“Another challenge we have is that many of the marketers have to lay off more than 90 per cent of their staff because of financial constraints,” he said.
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Adewole, however, said the government had promised that part of the money would come as promissory note and cash. According to him, 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 up the interest to be charged on our accounts. The interest came about as a result of devaluation of naira from N197 to N285 a dollar. Also what was approved to be paid is not the actual amount the government owes us. The interest came about as a result of devaluation of naira from N197 to N285 to a dollar.
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.
