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Petrol Subsidy: Nigerian Govt Owe Oil Marketers N130bn Arrears

The Nigerian government presently owes oil marketers an arrears of N130.7 billion covering a four year period the group has said.

Chairman of the Major Oil Marketers Association of Nigeria (MOMAN), Mr. Andrew Gbodume told journalists at a press conference in Lagos Monday, that it’s members, as a result of the debt, had not been able to make further investments apart from not embarking on products importation to augment NNPC’s efforts.

Despite being Africa’s largest crude producer, Nigeria depends on importation of refined products as the country’s refineries reportedly operates at less than 20percent of their installed capacity.

“Some of us are struggling to pay salaries, there has been no fresh investment made by our members because they were cash strapped and banks are no longer willing to lend to the downstream operators because they are not sure when they will recover their money,” Gbodume stated.

He also warned of the dire consequences to current regime which allows the Nigerian National Petroleum Corporation (NNPC) to shoulder responsibilities of importing products, adding that there is urgent need to regularly review the products pricing template.

“The current system which allows the Corporation to hold monopoly of importation was not sustainable, stakeholders should be allowed to proffer solutions and come up with a new sustainable model for the country,” he said.

“More worrisome is the idea where NNPC will allocate members products with only two weeks repayment window after which interest would be charged. We need to discuss new system of supply, petroleum economics is technical and we need to debate this and agree on a workable supply arrangements,” Gbodume stated.

He stressed the need for a honest conversation by all stakeholders on how to achieve a sustainable environment for Nigeria’s downstream petroleum industry vis-a-vis sustainable business model, pricing template, among others.

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