JONATHAN APPROVES PAYMENT FOR OUTSTANDING DEBT TO OIL MARKETERS

President Goodluck Jonathan has ordered the Coordinating Minister for the Economy and Minister of Finance, Dr. Ngozi Okonjo- Iweala, to raise Sovereign Debt Notes (SDNs) and pay part of the N215 billion backlog of interest and foreign exchange differentials on fuel subsidy, which the government owes oil importers.

The president, a source told New Telegraph yesterday, decided to intervene to ease the lingering nationwide fuel scarcity, which again, seeped into Lagos last week, following recommendations to him by the Department of State Service (DSS).
The DSS, it was learnt, had earlier summoned the Executive Secretary of the Major Oil Marketers Association of Nigeria (MOMAN), Mr. Thomas Olawore, after he threatened at a press conference last Friday that members of his association would freeze fuel importation due to a total of N256.2 billion debts on subsidy, inter-est and foreign exchange differentials. “The president has ordered the Coordinating Minister for the Economy to raise SDNs and pay part of the interest on the fuel subsidy and we believe that works must have commenced on this order.
His order was based partly on a recommendation to him by the DSS. “The DSS has summoned all the major stakeholders in the oil importing business, including the MOMAN man, after he addressed the press suggesting that there would be fuel scarcity if their debts are not paid. “We believe that the advice given to Mr. President must have been informed by thorough interrogation of these stakeholders,” the source said in a telephone interview.
The president’s order is a move to stop the last minute embarrassment, which the fuel scarcity could cause his government. Olawore declined to comment on his invitation by the DSS when New Telegraph called him on the phone yesterday. He, however, blamed the return of long fuel queues in Lagos and Abuja on the “tight corner,” which the government’s debts to marketers have put them. Olawore had also stated in a letter to Okonjo- Iweala that there would be potential reduction in the operations of importers with the delay in payment of fuel subsidy debts.
According to him, the outstanding debt, totalling N256.2 billion, include “N215,868,237,459 on Outstanding Foreign Exchange and Interest; N21, 920,240,908.23 subsidy on Batch T of 2014; N8,607,109,593.82 subsidy on Batch U of 2014; N6,873,232,365.66 subsidy on Batch A of 2015 and N2,911,139,639.70 subsidy on batch B of 2015.” He said the subsidy debts were “further compounded by the combined effects of the devaluation of the naira, higher inflation and increase in lending rates.”
Copies of the letter were given to the DSS, Director General, Debit Management Office (DMO) and the Executive Secretary, Petroleum Products Pricing Regulatory Agency (PPPRA). Olawore said: “Unfortunately, our members are no longer capable of enduring this commercial hardship and we foresee a reduction in activities at retail outlets as there would be significant scale down in petroleum products supply in the country due to cash constraints. Financial institutions have put on hold extension of further import credit lines to our members as a result of the amount due and our members are unable to finance imports out of their own cash flow.”
But amidst the worsening fuel scarcity, the Nigerian National Petroleum Corporation (NNPC) has assured Nigerians that it has enough stock of petrol to service the country for 27 days at a national consumption rate of 40 million litres per day. It has also stepped up efforts to end the distribution challenges in the fuel supply system. The oil corporation, in a statement yesterday in Abuja by its Group General Manager, Group Public Affairs, Mr. Ohi Alegbe, said it had sufficient stock of petrol at its coastal depots in Port Harcourt, Warri, and Calabar besides the stock being held in the national strategic reserves.
It attributed the fuel scarcity to distribution hitch occasioned by the strike by the National Association of Road Transport Owners (NARTO) and the Petroleum Tanker Drivers (PTD) that have refused to lift petroleum products from the coastal depots in protest of the huge amounts they are being owed by major marketers. “We are, however, working towards a speedy resolution of the issues to ensure a hitch-free distribution of products across the country,” NNPC stated.