Oil marketers appeal to govt over N800bn subsidy debts

Oil marketers appeal to govt for payment of N800bn subsidy debts

Oil Marketers under the aegis of Major Oil Marketers Association of Nigeria, MOMAN and Depot and Petroleum Products Marketers Association, DAPPMA, have appealed to the Federal Government for prompt payment of over N800 billion outstanding subsidy debts.

The marketers made the appeal in a joint interactive session with journalists at the weekend in Lagos on the need for government agencies saddled with the payment to expedite action to save marketers from the closing shop as interest on loans keeps increasing.

Executive Secretary, MOMAN, Mr. Cement Isong appealed to the government to hasten the payment of the outstanding debts of fuel imports subsidy arrears owed them (marketers) as the continued non-payment has severely limited their access to credit and negatively impacted their working capital leading to their inability to pay their banks and their service providers.

Isong urged the government agencies concerned to address the bureaucratic bottlenecks causing the delay in the payment process, adding that the delay in payment of the debt has resulted in the degradation of the downstream sub-sector of the oil and gas industry, and affected the marketers’ business operation.

He said that MOMAN is a downstream oil and gas group made up of six major marketers which include 11 Plc (formerly Mobil Oil Nigeria), Conoil Plc, OVH Energy Marketing Limited, Forte Oil Plc, MRS Oil Nigeria Plc and Total Nigeria Plc which has progressively gained a reputation in the Nigerian petroleum industry as a key player.

The MOMAN scribe assured their readiness to ensure the availability of petroleum products across the country during the and after the yuletide period, adding that marketers are fully ready to work with the government on effective products distributions.

According to him, the major challenge the Nigerian downstream petroleum sector is facing is the non-payment of the long outstanding fuel subsidy to oil marketers.

“We appreciate the efforts of the National Assembly and the Federal Executive Council in approving payment but the non-payment creates a significantly negative impact on the operational efficiency of the downstream sector of the oil industry, thereby placing a severe strain on its efforts to continually invest in infrastructure and raise industry standards. We hope that the debts will be paid in full to the oil marketers as soon as possible,” he said.

The MOMAN said that the debt owed its members alone stood at over N130.7 billion as at August 2018. He stated that once reconciliation has been done and a particular figure was agreed as debt, then he could not understand why settlements had not been made.

Similarly, the Executive Secretary, Deport and Petroleum Products Marketers of Nigeria, Olufemi Adewole, said the processes highlighted for payment by the government were inimical to the operations of their businesses.

Adewole said: “The processes they have highlighted is killing our businesses. Immediately the banks read in the media that the National Assembly had approved, they went to court, got an injunction and seized our assets.”

Adewole said that 60 percent of marketers have been forced out of business as banks have taken over their depots, assets, and properties due to their inability to pay back monies borrowed to import fuel.

He said many marketers were forced out of business, while others are struggling to survive due to the government’s inability to settle the subsidy arrears, saying the development is threatening investment in the downstream subsector.

The DAPPMAN said, although the Federal Government has earmarked money to clear the debts, the marketers were yet to be paid.

“The debt has had very adverse effects on our operations. I am aware of two depots that have been forcibly taken over by banks because they got injunctions from the courts. They did so the moment they heard that the National Assembly approved payment of the debt to marketers. Unfortunately, as at today, the money was yet to get into our accounts.”

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