The Nation Newspaper

Tag: Subsidy claims

  • Subsidy claims: Fed Govt. promises to pay N236b Friday

    Oil marketers should expect N236 billion payment from the Federal Government on Friday as the first tranche of the outstanding N348 billion subsidy claims by the Major Oil Marketers Association of Nigeria (MOMAN) and the Depot and Petroleum Products Marketers Association (DAPPMA).

    News of the proposed payment emerged yesterday after a meeting between officials of the Nigerian National Petroleum Corporation (NNPC) and representatives of the petroleum product marketers.

    The oil marketers had said earlier yesterday that contrary to reports, they were yet to reach an agreement with the Federal Government on the N800 billion subsidy arrears and declared the ultimatum to stop depot operations tomorrow remained unchanged.

    Executive Secretary of DAPPMAN Olufemi Adewole said in a statement in Lagos that offers by government failed to meet the legitimate demands of the association.

    “We did not sign the purported document with government as claimed. We still stand by our ultimatum which will expire on Monday,” Adewole said.

    But a few hours thereafter, the Chief Operating officer, Downstream of the Nigerian National Petroleum Corporation  (NNPC) Henry Nkem-Obih said an agreement had eventually been reached by the two parties.

    According to him, the first tranche will be paid on Friday while an arrangement will be made on the payment of the balance.

    His words: “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 notes that would be issued by the Debt Management Office (DMO).”

    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.

    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.

    Continuing, he 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 has 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 was 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 ready to ensure stable supply of petroleum products during the Yuletide period and beyond, stating the corporation currently 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 a few days time.

    Ikem-Obih said 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.

    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 as sabotaging efforts of government in ensuring stable fuel supply during the Yuletide season and beyond.

    Managing Director/Chief Executive Officer of A.Y.M. Shafa  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.

    Group Managing Director of Obat Oil and Gas, Prince Akinfemiwa Akinruntun, said the company was ready to support the government by loading 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 personal interest.

    He urged Nigerians to avoid panic buying  as efforts would be geared towards ensuring stability in petroleum products supply.

  • Senate seeks payment of fuel subsidy claims

    The Senate yesterday criticised the Federal Government for its alleged refusal to pay oil subsidy claims by petroleum products’ marketers.

    It said the government failed to pay the marketers despite the approval granted  by the National Assembly since July, 2018

    The Senate Committee on Petroleum (Downstream), held a stakeholders meeting in Abuja where the committee members took turns to disparage the government’s action.

    The senators claimed that government agencies appeared to have been deliberately slowing down paying the products marketers their entitlements.

    The committee ordered the Federal Ministry of Finance to, within one week initiate a meeting with other government’s agencies and the marketers to reconcile figures of subsidy claims.

    The committee also resolved that the meeting should discuss ways and means of fast tracking payment of arrears claims without further delay.

    Th Senators mandated the stakeholders to report back to the committee the progress made next week.

    The upper chamber had, in July 2018, approved payments of subsidy claims of over N348billion to oil marketing companies.

    The approval was granted based on a request by President Muhammadu Buhari, following, the adoption of an interim report by the committee on “Promissory Note Programme and Bond Issuance to Settle Inherited Local Debts and Contractual Obligations to Petroleum Marketers.”

    The Senate approved that the 55 oil marketers should be paid verified figures totalling N275,750,415,108.

    The upper chamber said 19 other marketers “with contentious claims and verified figures” be paid 65 per cent of their claims, totaling N73,452,639,866, pending further investigation and verification by the committee.

    Chairman of the committee, Senator Kabiru Marafa,  said the meeting was called to know how far the Federal Government had implemented the Senate’s resolution. He said  his committee wanted to know the situation with the 19 marketers with contentious claims.

    He said the committee wanted the resolution to the continued conflict of subsidy figures between the government and oil marketers.

    Marafa said: “The situation is becoming a vicious cycle that will not end. There is a general disquiet in the industry as I am speaking to you today, that government’s efforts may be sabotaged because as Chairman of this committee, I am aware of the very serious efforts put in place by this government to ensure that there is no fuel scarcity in this country. We have abundant quantities in every part of Nigeria.”

    He added that the government and the marketers reached agreement in June 2016, with another agreement made in June 2017.

    Marafa said that the government was yet to pay the agreed sums while the marketers had continued to groan over interests caused by the delay in their payment.

  • ‘How govt stalls payment of N570b subsidy claims’

    The Federal Government has stalled the process of paying marketers N570 billion subsidy claims by refusing to release a communiqué on the meetings between it and the marketers.

    The Executive Secretary, Depots and Petroleum Products Marketers Association (DAPPMA), Mr. Femi Adewole, who disclosed this to The Nation said the marketers, some weeks ago, had meetings with Dr Ibe Kachikwu and Alhaji Abba Kyari, the Minister of State for Petroleum Resources and the Chief of Staff to President Muhammad Buhari, respectively on the issue, adding that the government was yet to release a communiqué on the issue.

    The marketers owed include Major Oil Marketers Association of Nigeria (MOMAN), Independent Petroleum Marketers Association of Nigeria (IPMAN), DAPPMA, and Independent Petroleum Products Importers (IPPIs).

    According to him, Federal Government’s failure to release a communiqué stating the outcome of the meetings vis-a-vis the method of payment of the subsidy claims, has put marketers in the dark on the issue.

    Adewole said: “The communiqué is expected to provide impetus on the direction, which the marketers must take to recover their debts. It contains the resolutions of the government on the issue of payment of the subsidy claims, a development, which would help the marketers to know how and when to get their money back.

    “We (marketers) are waiting for the government to bring out the communiqué, which would show us the next line of action. We would not know what to do to recover our debts, until that is done.”

    Shedding more light on the issue, he said the money grew to N570billion from N394billion, due to unsavoury developments in the macro economy.

    ”Initially, marketers were being owed $2billion, by the Federal Government. That was when they imported fuel at the rate of N197 to a dollar. But with the exchange rate now sitting at N285 to a dollar (official rate), it implied that there is exchange rate differentials of $617.5 million to be paid by the government. This translates to N176billion. Altogether, marketers were being owed $2.6billion, including exchange rate differentials of $617.5million,” he added.

    He urged the government to create an enabling environment for the marketers to operate in the industry by paying the subsidy arrears owed them.

    On importation, he said marketers need to know whether the Federal Government would subsidise the cost of obtaining foreign exchange or not, adding that the idea would enable marketers know the price they would sell fuel in the country.

  • Buhari seeks approval to pay N413b subsidy claims

    Buhari seeks approval to pay N413b subsidy claims

    President writes National Assembly

    There  is good news for fuel marketers. President Muhammadu Buhari has asked the National Assembly to approve the payment of their N413 billion claims, it was learnt yesterday.

    The payment is believed to be the key to ending the crippling petrol scarcity in many cities.

    Petrol is being sold for between N100 and N400 per litre in various parts of the country. Queues are long at filling stations where there is fuel. Many others are shut for lack of supplies.

    A Presidency source said last night that “only about N140 billion was appropriated for subsidy payment in the current budget and it has been exhausted”.

    “Out of respect for the parliament, the President insisted that the right thing must be done by seeking approval from the National Assembly before an additional kobo is paid in excess of what the budget makes provision for.

    “This is a clear departure from the past, when extra-budgetary expenditure was the norm.”

    Another source said “the Nigerian National Petroleum Corporation (NNPC) expressed the belief that with the outstanding payment due to oil marketers now assured, the marketers and other downstream players will join hands with the corporation to guarantee that the nation remains wet with petroleum products all year round,” the source said.

    The Senior Special Assistant (SSA), Media, to the President, Mallam Garba Shehu, noted that the President “is desirous to end the petrol scarcity. But he insists that due process must be followed.”

    Marketers are hopeful that if the N413 billion subsidy cash is disbursed, the fuel scarcity will be over.

    But they also complained of lack of foreign exchange to facilitate importation of products.

    A marketer last night said: “We cannot access dollar or pound sterling to import. The banks have refused to give us letters of credit because they don’t have confidence that we will pay back. It is only the NNPC that imports and what they import is grossly inadequate.

    “The issue is that many independent depots and retail outlets don’t have products because the NNPC only gives product to marketers accredited as bulk buyers.

    “The fuel marketing arm of the oil industry is gradually collapsing because most of the oil marketing firms currently operate at about 30 per cent capacity utilisation. Some of our depots that load around 150 trucks daily have dropped to 40 trucks daily.

    “If the current supply situation is not addressed quickly, the Yuletide will be celebrated without fuel, and you know the implication.”

    The NNPC’s Group General Manager, Group Public Affairs Division, Mr. Ohi Alegbe, said the Corporation trucked out 25,042,686 litres of premium motor spirit (PMS) to various parts of the country  between last Saturday and Sunday..

    According to the data made available by the NNPC spokesman, which showed the depots from where the fuel was loaded, companies that took delivery of the product, the number of the vehicle that lifted the product and the quantity lifted, 615 filling stations got 25,042,686 litres. They include majors, such as Total, Mobil, Oando, MRS, Conoil and Forte Oil. The NNPC Retail and independents, including NIPCO and Eterna, among many others, especially in Gombe, also got supplies.

    Suleja depot loaded 7,178,613 litres for 179 stations, Kaduna depot 2,470 490 litres for 59 stations, Kano 4,930,847 litres for 107 filling stations, Minna depot 224,986 litres for six stations, Gusau 2,311 951 litres (60 stations), and Satellite depot, which feeds Lagos State, 2,164,940 (63 stations).

    Others include Ilorin depot 303,000 litres (nine stations), Ore 110,989 litres (three stations), Ibadan depot, 766,007 (21 stations), Gombe area, which has the highest number of independent stations got 3,662,893 litres (78 stations) and Aba depot, 917,970 litres (30 filling stations).

     

  • Marketers call for release of N413bn subsidy claim

    Marketers call for release of N413bn subsidy claim

    Some accredited oil subsidy marketers on Thursday said the failure of Federal Government to release the approved N413 billion subsidy debt was disrupting their fuel importation schedule.

    The marketers made their feelings known in an interview with the News Agency of Nigeria (NAN) in Lagos.

    They said that they were concerned that the money had not been released one week after the approval was granted.

    The marketers alleged that the delay was affecting loading activities at depots and had led to the shutting down of some filling stations due to non-availability of petroleum products.

    “Government, through the Central Bank of Nigeria, has not released any subsidy claims as promised.

    “As I am talking to you we have been directed by the CBN to go and meet the Debt Management Office for clarification.

    “All our efforts to get the said money have been in vain and to start importing has been a serious problem.

    “There is no money to back up the cheques presented to the marketers.

    “We do not even know the basis for the clarification of the cheques, but we are aware that there is no money in the account.

    “It is like giving the marketers cheques only to discover that there was no money in the account.

    “Nothing like importing now because all marketers are angry because of the failed promised,” one of the marketers al

    The market said; “If you go outside Lagos you know how much they are selling fuel per litre now, it is the last stock that we are selling now.

    “It is unfortunate that the Department of Petroleum (DPR) is saying that we are hoarding the products, which is not the truth.

    “We have not collected a single coin from the money.

    “If not the fact that some of the marketers are making some money from other products, how do you think we will be able to get anything for now?

    “We have been summoned by DPR for a meeting this morning to settle the crisis, we are only managing what we have in stock at present,” he said.

    NAN recalls that the Federal Government, had on Nov. 3, approved the sum of N413 billion to petroleum products marketers as the outstanding payment for subsidy claims.

  • NUPENG tasks FG on prompt payment of subsidy

    NUPENG tasks FG on prompt payment of subsidy

    The National Union of Petroleum and Natural Gas Workers (NUPENG) have told the Federal Government to ensure prompt payment of fuel subsidy to avoid persistent scarcity of petroleum products.

    The South-West Chairman of the union, Mr. Tokunbo Korodo, told the News Agency of Nigeria (NAN) in Lagos on Tuesday that the current scarcity was due to late payment of subsidy claims to petroleum marketers.

    He said that non-payment of the claims had led to non- importation by marketers and loss of jobs by many workers.

    The chairman, however, said that activities had resumed at various loading depots in Lagos and other cities because government had released N413b to marketers.

    “Presently, loading of petroleum has commenced in different loading depots in Lagos and the states and I can assure you this has greatly increased distribution of products in the country.

    “As far as I’m concerned, there is little or no queue of motorists at filling stations in Lagos presently because the product is available in almost all stations.

    “The marketers are also aware of the sanctions that would be given to any filling station that sells above the pump price or refuses to sell when the product is available,’’ he said.

    Korodo urged motorists to exercise patience, adding that the product would soon be distributed to all filling stations in the country.

    A NAN correspondent who monitored depots and filing stations along Ikorodu Road, Ojuelegba, Iyana-Ipaja and Agege areas of Lagos, reports that filling stations were dispensing fuel.

    Some attendants at the filling stations that were shut said that they were waiting for product.

    It was also observed that there was no queue in most of the stations visited and they were selling at the official pump price of N87.

     

  • FG to pay oil marketers N156b subsidy claims Thursday

    The Federal Government would on Thursday pay a total of N156 billion to major petroleum marketers to defray the I Owe You (IOU) and their interest rate differentials.

    The Coordinating Minister of the Economy and Minister of Finance, Dr. Ngozi Okonjo-Iweala,  told journalists while leaving the  Conference of Directors General of Customs of the West African Region of the World  Customs Organization, in Abuja, Wednesday.

    The minister said, “As I leave here I am gong to sign for them (major marketers) to get another N156 billion in the IoU which we will issue them , I think that will be tomorrow, and N56billion in interest rate differential.”

    The minister recalled that in December last year, the federal government paid N350billion to the marketers in addition to N21billion that was also paid as foreign exchange differentials.

    The federal government, Okonjo-Iweala said, is still dialoguing with the petroleum marketers on the subsidy payment.

    Her words:  “Let me tell you. On the issue of the oil marketers, we have been working with them. We have been dialoguing with them all along. We paid them N350billion in December. We have paid them N21billion for foreign exchange differential , and by tomorrow (Thursday) we will be paying them the N100billion for which we gave them IoUs as well as their interest rate differentials of N56billion. So I am about to go and sign to ensure they get paid.”

     

  • 19 oil marketers get N192.5b subsidy claims

    19 oil marketers get N192.5b subsidy claims

    The Federal Government has paid 19 oil marketers with the total sum of N192, 502,279,966.50 this year.

    The sum was paid to clear the marketers’ subsidy claims.

    A statement from the federal ministry of finance signed by Paul Nwabuikwu said the finance ministry has so far paid N192, 502,279,966.50 to 19 oil marketing companies this year.

    Nwabuikwu noted that addition, a total of N135, 696,269,214.05 was paid to oil marketers in respect of verified 2011 and 2012 arrears.

    That sum, according to Nwabuikwu, was paid earlier this year.

    He said the payments were in” line with the ministry’s commitment to manage fuel subsidy regimein a transparent and efficient manner that protects and enhances the interests of the Nigerian people.”