Fuel crisis looms as marketers write Senate over N800b subsidy debts
As Nigeria nears the yuletide, the nation may suffer yet another fuel supply crisis as oil marketers have written Senate Committee on Petroleum Downstream over non-payment of subsidy arrears by the federal government.
TheNewsGuru (TNG) reports the oil marketers had on Sunday in Lagos gave the FG a seven-day ultimatum to settle outstanding debts totaling N800 billion, failing which, depots would cease operation across the country.
The marketers, comprising Major Oil Marketers Association of Nigeria (MOMAN), Depot and Petroleum Products Marketers Association (DAPPMA) and Independent Petroleum Products Importers (IPPIs), said failure to meet the deadline would force its members to disengage workers from depots.
Senator Kabir Marafa, who read the oil marketers letter at Senate plenary session on Thursday, raised a motion on the urgent need to avert the looming crisis in fuel supply due to non-payment of the fuel subsidy arrears to the independent marketers.
“The Committee on Petroleum Downstream received a letter from DAPMAN on the non-payment of subsidy arrears by the Federal Government. If the demands are not met, they will shut down in 7 days,” Senator Marafa said.
In their contributions, Senators Yahaya Abdullahi, Barnabas Gemade and Ahmad Babba Kaita pleaded with leadership of the Senate to prevail to avert the looming fuel supply crisis.
“I am a member of this particular Committee, we had a long meeting, we have gone through all the necessary procedures and offices. We have to make sure these funds are released so we can avert this strike,” Senator Abdullahi said.
While Senator Gemade stated that “Withholding of these payments has nothing to do with the National Assembly, it is the executives that are responsible, the necessary ministries and agencies should pay DAPMAN so as to avert this crisis”, Senator Kaita said, “This motion is timely, it is a matter that affects our lives in it’s totality. Christmas is coming so this should be averted. This Senate should do anything humanly possible to stop this”.
Confirming the seven-day notice, Mr Patrick Etim, Legal Adviser to IPPI had said banks have taken over investments and assets of oil marketers over the unpaid debts.
According to Etim, marketers have no choice than to ask their workers to stay at home over unpaid salary arrears due to huge subsidy debts owed by the government.
“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,” he said.
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,” he said.
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.
The Executive Secretary of DAPPMA, Mr Olufemi Adewole, also confirmed the seven-day ultimatum notice.
Adewole disclosed that the oil marketers on Nov. 28 served the ultimatum letter on the Debt Management Office (DMO), Minister of Finance, Chairman, Senate Committee on Petroleum Downstream, Department of State Services and Minister of State, Petroleum Resources.
“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,” he said.