It emerged on Saturday that oil marketers under the aegis of Major Oil Marketers Association of Nigeria (MOMAN) and the Depot and Petroleum Products Marketers Association (DAPPMA), who have been owed about by N348 billion by the federal government as outstanding payment on petrol subsidy claims, would be paid N236 billion on Friday this week.
Chief Operating Officer (COO), Downstream, NNPC, Mr. Henry Ikem-Obih, disclosed this on SUnday. Ikem-Obih said after this first tranche, the balance of the subsidy debt will be cleared by the government in 2019 and 2020.
That was as DAPPMA on Sunday, denied reaching an agreement with the Federal Ministry of Finance on the payment of the N800 billion subsidy arrears, urging its members to shut down all petroleum depots nationwide.
Speaking after a meeting with officials of petroleum product marketers in Abuja, 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 it will be paid through promissory note 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, explaining that injecting cash of that magnitude into the economy may affect the country negatively.
Ikem-Obih said this mode of settlement had been agreed between the government and the oil marketers since 2017, and it was not a new development.
He noted that the government 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.
“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,” Ikem-Obih added.
While explaining the disparity between the N800 billion claimed by the oil marketers and the N348 billion approved by the National Assembly, he 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 and beyond, stating that presently, the corporation has over 2.8 billion litres of petrol in stock which would last 55 days.
Ikem-Obih further stated that 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. He said MOMAN, DAPPMA and IPMAN had assured the 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.
In addition to the imported fuel stock, he stated that the country’s refineries would also be contributing to fuel supply, with the Warri Refinery reportedly returning to production last Thursday, while Port Harcourt refinery would soon resume production.
Speaking at the meeting, the Chief Executive Officer of A.A. Rano Limited, Mr. Aliyu Sa’id, said his company would not be part of any operations shutdown by DAPPMA and MOMAN. He said the timing was wrong, and oil marketers should not be seen to be sabotaging the efforts of government in ensuring stable fuel supply during the Yuletide season and beyond.
In a similar vein, Managing Director of A.Y.M. Shafa, Mr. Ahmad Abdullahi, stated that at this time that the country was going through series of challenges, which included security and financial problems, any plan by the oil marketers to stop operations could make things worse.
Abdullahi urged other oil marketers to support the government and trust its decisions as it concerns settlement of the outstanding claims.
Prince Akinfemiwa Akinruntan, who is Group Managing Director of Obat Oil and Gas, said the company was ready to support the government by loading products on a 24 hours basis. Akinruntan noted that NNPC had been supportive of oil marketers over the years, and that national interest superseded his personal interest, hence, his decision to keep his facilities open.
Meanwhile, DAPPMA denied reaching an agreement with the Federal Ministry of Finance on the payment of the N800 billion subsidy arrears, insisting that its seven days ultimatum stands.
DAPPMA, in a statement signed by its Executive Secretary, Mr Olufemi Adewole, said there was no agreement with the union, noting that offers made by ministry failed to meet the legitimate demands of the association.
According to him, “We refer to the press release from the Federal Ministry of Finance on December 6 following the meeting with marketers under the aegis of Major Oil Marketers Association of Nigeria (MOMAN), and DAPPMA, and Independent Petroleum Marketers Association of Nigeria (IPMAN), which said the marketers had agreed to resume operations.
“We did not sign the purported document with government as claimed. We still stand by our ultimatum. We cannot continue to borrow money to pay staff salaries.”
A coalition of petroleum products marketers had on December 2 given the federal government a seven-day ultimatum to settle outstanding N800 billion subsidy payment in cash, threatening to cease their depot operations across the country should the federal government fail to meet their demands.
But Special Adviser to the Minister of Finance, Mr. Paul Abechi, on December 6, issued a statement, saying marketers had reached an agreement with the federal government on the settlement of the outstanding subsidy claims.