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Fuel scarcity looms as oil marketers plan showdown over N800bn subsidy debts

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Fuel scarcity looms as oil marketers plan showdown over N800bn subsidy debts

There are growing fears over possible fuel scarcity as oil marketers have given the federal government a seven-day ultimatum to settle outstanding debts totalling 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.

Confirming the seven-day notice, Patrick Etim, legal adviser to IPPI, told NAN that banks have taken over investments and assets of oil marketers over unpaid debts.

According to Etim, marketers have no choice that 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,” he said.

“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.”

Etim said 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 the current administration paid part of the debts with a substantial portion of the subsidy interest and foreign exchange differential still pending.

Olufemi Adewole, executive secretary of DAPPMA, also confirmed the seven-day ultimatum.

Read also: Export of Nigeria’s crude oil to US hits all time low

Adewole disclosed that the oil marketers on November 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,” he said.

“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.”

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