Oil marketers urge FG to pay $2bn fuel subsidy arrears

The Major Oil Marketers Association of Nigeria
(MOMAN) has appealed to the federal government to
pay the fuel subsidy claims owed to its members.

On Monday, some oil marketers had appealed to the
federal government to pay their outstanding debts of
two billion dollars (N720 billion) owed on the
importation of petrol products and the accrued
interests on bank loans.

Obafemi Olawore, executive secretary MOMAN, who
made the plea on Wednesday in Lagos, said they
needed it to pay back their bank loans.

Olawore said the immediate payment of the
accumulated subsidy claims would salvage the banks
from total collapse over the huge debts owed them by
marketers, and avert the scarcity of petroleum
products in the country.

According to him, the delay in repayment of the loan
debts owed the banks by marketers had led to a
retrenchment in the banking and the oil and gas
sectors.

“We (marketers) are afraid that if the money is not
paid on time, this may attract the Asset Management
Corporation of Nigeria (AMCON) to take over our
businesses,” he said.

“The debts had imparted grossly on marketers, while
only very few marketers are presently importing
insignificant quantity of petroleum products into the
country.”

Olawore added that inability of the marketers to import
fuel had impacted negatively on loading activities at
the Apapa and Dockyard private depots.

He noted that the NNPC had become the sole importer
of petroleum products, while marketers were queuing
to get the products on credit.

He said that the federal government paid over N300
million daily as fuel subsidy.

Olawore also said that a problem in the oil sector
invariably affects the banking sector, because of the
unpaid loans collected by marketers borrowed.

He explained that some banks might be having
problem with their correspondence banks abroad due
to the unpaid loans.

“Once we (marketers) are unable to pay, the banks will
have problems,’’ he said.

“This can have negative effects on the financial
sector’s stability, which is not good for the economy.

“A situation where the banks are being owed N800
billion constitute major threat to the continuous
existence of the sector.”

TheCable