FG moves to avert fuel scarcity

Posted by News Express | 14 November 2014 | 3,088 times

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The Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke, has promised to ensure that the outstanding N190.56bn fuel subsidy arrears is paid to petroleum marketers before the end of the month.

The minister, who gave the assurance at a meeting with members of the Depot Owners and Petroleum Products Marketers Association (DAPPMA) and Major Oil Marketers Association of Nigeria (MOMAN) in Abuja yesterday said she was already in consultation with the Minister of Finance on the issue.

She stated that the intervention is aimed at achieving a hitch-free distribution of petroleum products across the country.

Alison-Madueke disclosed that she has already briefed President Goodluck Jonathan on the implications of the continued delay in the payment of subsidy to the marketers.

She is also scheduled to meet with the Governor of the Central Bank of Nigeria (CBN), Mr. Godwin Emiefele, to prevail on banks not to make good, their threats to withdraw facility lines from the marketers on account of the debts arising from the delay in settling petroleum subsidy arrears.

Chairman of DAPPMA, Mr. Dapo Abiodun, had earlier urged the minister to intervene to sort out the issue before it degenerates into another bout of fuel scarcity in the country.

The Executive Secretary of MOMAN, Mr. Obafemi Olawore, on his part, stated that already stocks of petrol in the various depots in Apapa, Lagos, are fast depleting, urging the minister not to allow the situation get to the point where products dry up first before intervening as this will not augur well for the country, especially as the end of year festivities approach.

The petroleum products marketers welcomed the minister’s statements, adding that they felt reassured by her promise to ensure that the subsidy arrears are settled by the end of the month.

The negotiations between the marketers and government had suffered a setback in July as the interest on bank loans and foreign exchange differentials pointed to huge trading losses for the importers.

The government had stated that final payment of interest and foreign exchange differential cost claims to oil marketers cleared by the Economic and Financial Crimes Commission and the Special Fraud Unit had resulted in a directive by the Finance Ministry to pay N44.1bn to the marketers.

Olawore had stated then that, “interest claims do not just happen. They are as a result of interest changes on borrowed funds from the banks. This means no importer makes any gain on interest claims.

“Rather, claims made by importers are actual debit notes from the banks, which have always been verified by the Petroleum Products Pricing Regulatory Agency and the Federal Ministry of Finance before payment is made through the importers to the banks.”

He stated that, although the Federal Government had paid N44.1bn to the marketers, the grand total of subsidy arrears owed was N190.56bn.

Olawore stated then that out of the amount, major oil marketers were owed N94.157bn.

He said: “The general public needs to be told how and why importers make claims on interest and foreign differential costs.

“Under the Petroleum Support Fund’s approved guidelines as amended, the PPPRA is obligated to reimburse oil marketing companies within 45 days the loss incurred by them arising from the differential between the landing cost of the product and the government approved pump price.”

Source: National Mirror. Photo shows Petroleum Minister, Alison-Madueke.

Source: News Express

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