The Independent Petroleum Marketers Association of Nigeria (IPMAN) has urged the Federal Government under President Bola Tinubu and the Nigerian National Petroleum Company Limited (NNPCL) to put in necessary mechanisms and checks to avoid corruption in the management of the $3bn facility from the African Export-Import Bank (Afreximbank).

The Group Chief Executive Officer (GCEO), NNPCL, Mallam Mele Kolo Kyari signed for the oil company, while Vice President, Afreximbank, Dr George Elembi, signed for the bank during the transaction ceremony at Afreximbank’s headquarters in Cairo, Egypt.

In an interview with Saturday Telegraph, Chairman, IPMAN, NNPC depot Ore, Western Zone of Nigeria, Engineer Shina Amoo, said the FG and NNPCL should ensure transparency and judicious utilisation of the fund.

He urged them to avoid the notion that past funds were muddled with corruption and diversion.

He stated that if the facility was well utilised, it could stabilise the naira, reduce forex exchange volatility, high cost of fuel and the attendant hardship and sufferings Nigerians are currently enmeshed in.

NNPCL and Afreximbank had jointly signed a commitment letter and Termsheet for an emergency $3 billion crude oil repayment loan.

NNPCL said the facility would provide some immediate disbursement that will enable the NNPCL to support the Federal Government in its ongoing fiscal and monetary policy reforms aimed at stabilizing the exchange rate market.

Spokesman to President Bola Tinubu, Ajuri Ngelale, noted on his Twitter handle that the FX accretion would enable NNPC to defray taxes and royalties in advance as well as provide the federal government with dollars to aid liquidity to stabilise the naira via incremental releases based on the government’s needs.

He noted that “Stronger naira equals lower fuel costs. This is a major buffer against the need to re-engage in the subsidy regime.”

Amoo said if the fund was well managed, it could stabilise the naira; reduce forex volatility and the high cost of fuel.

He stated that Nigerian are cautious and still optimistic about the prudent management of the facility.

Amoo said, “Until we see the result. However, I must point out that there must not be corruption in the management of the facility. There should be transparency and effective use of the money. If it is used in such a way as to stabilise the naira which will reduce inflation and people’s hardship, it is then that we can say that we have achieved something. Other than that, there is no achievement.

“But I pray that it would not go the way the issue of subsidy and other national interventions that were allegedly enmeshed in corruption, went. If we can strengthen the naira and we see the exchange rate of the naira and dollar coming down, the speculators are dealt with and the effect of the loan is felt; the money is being well utilised, then we would have seen the positive impact of the loan. Then it will positively affect the lives of all citizens.

“Importers of petroleum products are having problems because of this forex volatility. This particular loan will also reduce the volatility. That is one of the purposes of the facility. By the way, they are able to utilise it effectively and well, we would be able to have something good from their end also.”

He stated that oil retail marketers have been having low sales. He stated that recently the Chief Executive of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) Engineer Ahmed Farouk, revealed that the current daily fuel consumption has drastically reduced as against 65 million litres which had been the daily consumption before subsidy removal.

He noted that Farouk has said that the daily fuel consumption in January, was 62 million litres per day; February, 62 million litres per day; March, 71.4 million litres per day; April, 67.7 million litres per day; May 66.6 million litres per day; June, 49. 5 million litres per day and July, 46.3 million litres per day.

Amo also said that they are currently having business challenges since the removal of the fuel subsidy, which made fuel price rise and reduced patronage as fuel users now consume less.

He called on the government to assist them to solve the challenges they currently encounter.

Amoo added, “We do not deal with the dollar, we do not deal with importation but we retail the products that are already imported into the country. The issue we are facing is a lack of credit access and no profit on the business for now.

“The third one is that the end users are running away from petrol. Many of them are converting to gas and many of them are minimising the use of petrol. If the daily consumption of petrol is reduced from 62 million litres a day to 44.3ml a day as of July, and we are having a shortfall of 17.7ml per day, it is going to affect each and every business and economy.

“The high cost of the dollar has impacted the high cost of petrol and the high cost of petrol has reduced our sales and consumption in the country per day, sales and sourcing of funds from the banks.

“Now that the banks know that we are not having much access to profit, how can they lend us money and we pay back?” (Saturday Telegraph)