Tag Archives: Subsidy

House of Reps to investigate fuel subsidy from 2012.

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The House of Representatives yesterday announced that it would begin a fresh investigation into the petroleum subsidy regime from 2012 to May 2016.The Chairman, House ad hoc committee on the review of petroleum pump price, Nnana Igbokwe, said the decision was necessitated by the conflicting documents submitted by various oil marketers.

He said the marketers were those involved in the importation of Premium Motor Spirit (PMS) and Direct Purchase Direct Sale (DSDP)’s arrangements with the Nigerian National Petroleum Corporation (NNPC).

The oil marketers had alleged that the Federal Government owed them N300 billion, being the payment of subsidy to bridge the differential in the cost of importation and pump price.

Igbokwe, who decried the level of impunity in the oil industry, specifically queried the NNPC over the allegation of endless reconciliation of petroleum products’ imports worth over $1 billion.

The committee resolved that the activities surrounding forex allocation and Petroleum Equalization Fund (PEF) should be put on hold for further enquiry.The lawmakers summoned the Managing Director of Ramaniyah Oil Company over alleged withholding of 6.741 million litres of PMS since January 2013, as well as the lifting of crude, which could not be traced by the committee.

They also directed the Managing Director of Lubcon Nigeria Limited to appear in person to explain what the $2,337,500 he collected through Ecobank under the special intervention fund was used for.

Igbokwe promised to conduct a forensic audit on the documents submitted by the oil companies and recommend appropriate sanction against any one found culpable.Also, the House Committee on Public Accounts yesterday raised an ad hoc panel to investigate allegation of financial impropriety leveled against the National Orthopaedic Hospital, Igbobi, Lagos.

The office of the Auditor General of the Federation, in a query to the lower legislative chamber, had alleged that 86 different types of drugs that expired in 2011 were not destroyed.

The query also included the controversial waiver of medical bills of over N638, 380 at the hospital.At an investigative hearing by the committee on the two allegations, the Chairman of the committee, Kingsley Chinda, said there was the need to inquire into the allegations against the hospital’s authorities, beyond the oral and written evidence that had been given.

But, the Chief Medical Director, Dr. Olurotimi Odunubi, confirmed that the expired drugs had already been destroyed.He said: “All expired drugs from 2007 to 2012 were boarded and buried in February 2013. These included the drugs under reference and the due process for boarding was also followed.”

On the bills for patients, Odunubi said medical bills for certain patients were actually written off as ‘bad debts.’He said beneficiaries of the decision were indigent patients and those without relatives who were brought by the police, as well as those abandoned in the hospital.

Odunubi further stated that before the action was extended to the patients, efforts were made to locate their relatives or those that could assist in paying their bills.

The next hearing was fixed for April, 18, 2017.

 

Source: The Guardian

Senate orders fresh probe of NNPC

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The senate has mandated the committee on petroleum downstream to investigate the non-remittance of funds by the Nigerian National Petroleum Corporation (NNPC) to the federation account.

The committee will also investigate an alleged abuse of product marketing and distribution between 2006 and 2016.

The resolution by the senate was sequel to a motion entitled ‘discrepancies in subsidy payment and non-remittance of funds by the NNPC to the federation account’.

The motion was sponsored by Dino Melaye, senator representing Kogi west.

Melaye expressed dismay that despite the crackdown by the Buhari administration, the NNPC has refused to remit funds to the federation account.

“The independent marketers account for 49 percent of the imported petroleum product, while the NNPC accounts for 51 percent of imported products, but this does not justify the huge amount it has been paid as subsidy in the last 10 years,” the senator said.

“From the records derived from the PPMC, 5 to 10 cargoes of imported crude arrives the country monthly, while about 5 cargoes are refined locally and each cargo contains 5.8 million litres of the refined crude products.

“The excess products which cannot be dispensed that goes into different tank forms owned by private individuals are not properly accounted for as they illegally sold off by the owners of these tank farms in a manner that is opaque and usually designed to rip off the public and enrich a few persons stupendously at the expense of the masses.”

He said since the Buhari administration “clamped down” on subsidy payments, NNPC has solely been responsible for retail of petroleum products.

“Companies like BOVAS and RANO are paying N20 to N25 per litre for the sales of this product which amounts to over N2 billion monthly,” he said.

“These monies are not accounted for and that might be the reason why we now see petro-dollars in caskets and uncompleted building in remote villages in some parts of the country.”

The senate adopted the motion after it was put to a voice vote by Bukola Saraki, senate president.

In December 2016, the Nigeria Extractive Industries Transparency Initiative (NEITI) said as of 2014, the NNPC had withheld $15.8 billion from the federation account paid by the Nigeria Liquefied Natural Gas.

“NLNG paid $1.42 billion to NNPC as dividends, loan and interest repayments for 2014 but the amount could not be traced to the Federation Account,” NEITI had said in a report.

“Between 2005 and 2013, there was an outstanding of $12.92 billion of dividends, interest and loan repayment made by NLNG to NNPC but not remitted to the Federation Account;

“The 2014 audit uncovered evidence of $1.5 billion paid by NLNG to NNPC between 2000 and 2004 but also not remitted. This brings the sum of unremitted NLNG dividends, interest and loan repayment to $15.8 billion as at the end of 2014.”

 

Source: The Cable

Senate to probe alleged N5.1 trillion subsidy fraud in NNPC

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The Senate is set to probe the Nigerian National Petroleum Corporation (NNPC) over claims that it mismanaged about N5.1 trillion it got as subsidy funds between 2006 and 2015.

While raising a point of order, Dino Melaye (APC, Kogi West), drew the attention of the Senate to the refusal of the presidency to probe the nation’s oil corporation, which he said got 51 per cent share of companies approved to import petroleum products into the country.

The N5.1 trillion allegedly mismanaged is about 70 per cent of the N7.298 trillion national budget of 2017 and out of which the government plans to borrow N2.32 trillion. If this amount is recovered, it would help in funding government projects. The amount of money allegedly mismanaged shows that the nation does not lack revenue to execute projects and programmes that could improve the wellbeing of the citizens. What it lacks is the effective management of the revenue. Also, the planned probe will lend credence to the anti-corruption campaign since the NNPC which is the nation’s cash cow is considered to be a nerve centre of corruption.

He said: “Surprisingly you (the Senate President, Bukola Saraki) are one of those who raised the issue of subsidy in the Seventh Senate. The Federal Government is prosecuting marketers and these marketers only constitute 49 per cent of imported refined products. The NNPC is responsible for the importation of 51 per cent.

“While we are prosecuting the independent marketers whose proceed from subsidy is about N3.83 trillion, NNPC collected a total of N5.1 trillion on subsidy and this has never been investigated and we are busy chasing independent marketers. The time to look at the books of NNPC as regards petroleum subsidy is now.

“We have taken the lead in the fight against corruption in this chamber and I want to say we must do everything within our powers to investigate and bring whoever is found wanting to book.”

Saraki gave nod to the plea by Melaye, who had sought the permission of the chamber to sponsor a motion today. “Thank you Senator Melaye for that radical performance,” Saraki said.

He added: “Melaye, we expect this motion tomorrow (today) and it is a very serious issue. It goes to the core of the fight against corruption and also the issue of NNPC which is a great source of revenue for all of us. We will wait for that motion today.”

Also yesterday, the Upper Chamber urged the Federal Government to urgently pay the N2 trillion owed local contractors.The debts, the Senate noted, are those owed contractors operating in the oil and gas sector, as well as others in the pharmaceutical industry.

During a debate on the motion sponsored by Oluremi Tinubu, Saraki warned that the inability of the Federal Government to repay its debts would adversely affect the economy.

“The inability of the government to pay its debts will have serious effects on our economy. I know that the Federal Government is making efforts to ensure that they pay their debts. That is why they are trying to raise international bonds. I urge them to hurry up so they can pay these debts,” he said.

Adopting the motion, titled “The urgent need for the Federal Government to redeem local contractors’ debts,” the lawmakers expressed worry that the inability of the government to repay the debts is already negatively affecting the economy.

Tinubu said any further delay in servicing these debts might adversely affect business organisations operating in the country, especially banks, owing to the fact that many businesses are indebted to the financial organisations.

“The inability to repay subsisting bank loans may affect the purchasing power of petroleum marketers, thus creating scarcity of petroleum products.“I am further concerned about the alleged failure to pay debts owed to pharmaceutical companies and the impact this may have on the health sector.

“The data released by the Debt Management Office put Nigeria’s domestic debt as at June 30, 2016 at over N10 trillion. Local contractors debt is estimated to amount to an additional N2 trillion.

“Settling these local debts will ensure that affected businesses stay afloat through an increase in the circulation of money in order to bring the current economic recession to an end,” Tinubu explained.

Jibrin Barau said if contractors were paid their debts, it would enable them to repay their loans to banks. He said in turn, banks would be able to give more loans to business owners.

Magnus Abe warned that a repeat of what happened in the past, when banks owed huge debts and went under, must be avoided. He noted that families who were affected by these huge debts were unable to meet their daily obligations. Shehu Sani said as the chairman of the Committee on Local and Foreign Debts, he had been inundated with calls from local contractors.

Meanwhile, Saraki has ordered chairmen of all the standing committees to submit the final copies of budgets of agencies under their purview to the Chairman of the Senate Committee on Appropriation, Danjuma Goje.

Saraki who made the announcement during plenary, said the final copies of the reports must be submitted on or before Friday, 3rd of March, 2017.
The Senate also yesterday directed its Committee on Customs, Excise and Tariff to investigate the recent illegal importation of 661 sophisticated weapons into the country, and other related offences as well as identify the importers and their collaborators irrespective of their status in the society.

The committee was mandated along with that on Interior, to examine all the processes involved in importation of goods and ascertain also who does what and how, in the said process with a view to determining whether the process and its operators are effective, efficient and of required standards.

These resolutions were sequel to a motion titled “Urgent need to stem the proliferation of Small Arms and Light Weapons in Nigeria” moved by Hope Uzodinma (PDP Imo West), in which he noted that the influx of illegal small arms and light weapons into the country was a threat to the peace and security of the country.

 

Source: The Guardian

Presidency orders immediate payment of N150 billion subsidy claims to marketers

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The presidency on Tuesday ordered the immediate payment of the N150 billion outstanding subsidy claims owed petroleum products marketers.

The order is coming amid speculations that government was considering increasing fuel price in the country in the face of rising fuel importation and distribution costs.

The speculations were fuelled by reports ahead of the scheduled meeting of the Board of the Petroleum Products Pricing Regulatory Agency, PPPRA, on Thursday to review the existing petroleum products pricing template fundamentals, among other issues.

Since May 2016, when the template was adjusted, raising petrol price from N86 per litre to between N135 and N145 per litre, prevailing market conditions have fuelled calls for further review of the retail pump price.

Global crude oil price, which rose from below $30 per barrels then to the current price of $52 per barrel, and the Central Bank of Nigeria foreign exchange policy have resulted in the scarcity of funds for petroleum marketers.

The rising cost of fuel importation had caused major and independent petroleum marketers to abandon importation of petroleum products for the Nigerian National Petroleum Corporation, NNPC, which accounts for more than 60 per cent of the total national stock.

A senior NNPC official told PREMIUM TIMES on Tuesday in Abuja that the corporation was bearing the bulk of the almost N90 billion cost incurred as subsidy on importation of petroleum products.

The official, who requested that his identity should not be revealed as he was not authorised to speak on the issue, said the cost was as a result of high landing cost, distribution margins and port charges by the Nigerian Maritime Administration and Safety Agency.

Ahead of the meeting of the PPPRA Board, close watchers of the market said the regulatory authority could be considering a review in the pricing template to allow for adequate accommodation of the costs to sustain importation of products.

But, the Nigeria Labour Congress President, Ayuba Wabba, in a telephone interview on Wednesday allayed fears by Nigerians about any plan by government to increase fuel prices, describing any such decision as a ‘no go area.’

“It is not true,” Mr. Wabba said of alleged plans by the PPPRA to take a decision during its meeting to raise fuel price.

“Nobody would dare go to that area. We have just finished a meeting this evening at the (Presidential) Villa on the issue, and it was very clear and emphatic that nobody would make any attempt to touch that issue.

“The meeting of the PPPRA Board would dare not include that on its agenda. It was clear at the meeting at the Villa that fuel price increase is a no go area. Even the petroleum products marketers are aware of this.

“Government knows that fuel price increase is a very sensitive issue at this time and therefore nobody should take Nigerians for a ride. It is commitment given by the Chief of Staff to the President, Abba Kyari, on behalf of the federal government.

“Every marketer, both major and independent, NNPC, PPMC (Pipelines and Petroleum Products Marketing, Company) were there at the meeting.

Mr. Wabba said the meeting, called to address the challenges in the shortage of diesel, kerosene and other products, also resolved to ensure that products were available across the country, particularly in the rural areas.

The meeting attended by all the relevant ministers, including those in charge of petroleum resources, labour and productivity as well as the Central Bank governor, resolved to take steps to encourage more involvement of other marketers in fuel importation.

“Government was very emphatic during the meeting that nobody should contemplate anything about increment in price of petroleum products,” the labour leader said.

Oil workers have said they would not accept another increase in petrol price at this time.

PENGASSAN President, Francis Johnson, said all the participants at the meeting would not like to go back on their pledge, describing any attempt to increase fuel price as “suicidal.”

Part of government’s efforts to encourage marketers to resume the importation of petroleum products includes the approval for the payment of the N150 billion Petroleum Equalisation Fund debt owed petroleum marketers.

The National Secretary of Independent Petroleum Marketers Association of Nigeria, IPMAN, Zarma Mustapha, said the money was part of the subsidy refund on the cost of distribution of petroleum products across the country.

Subsidy Fraudsters Sentenced to 10 Years in Prison

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A Lagos High Court in Ikeja has sentenced Walter Wagbatsoma and Adaoha Ugo-Nnadi to 10 years in prison for fuel subsidy fraud.

The judge said the sentence would start to count from January 13, 2016.

She also ordered restitution for Ontario Oil and Gas, and asked the company to refund N754 million being the amount it defrauded the Nigerian government.

Details later.

No provision for fuel subsidy in 2016 budget – NNPC

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The Nigerian National Petroleum Corporation (NNPC), has said it has no plans to increase the pump price of petrol from N145 per litre, neither was it contemplating a return to subsidising fuel.

The rebuttal is coming on the heels of a statement credited to the Group General Manager, Crude Oil Marketing Division, NNPC, Mr. Mele Kyari, that the sale of petrol at N145 was no longer feasible at the current exchange rate.

In a swift reaction yesterday, the NNPC, through its Group General Manager, Group Public Affairs Division, Mr. Garba-Deen Muhammed, said reference of unsustainability of N145 per litre of petrol only relates to possible spike in international market price of petroleum products.

“This has been mitigated by NNPC’s long-term procurement contract plan that guarantees stable pricing.”

Muhammed further stated that it had a robust supply arrangement that can guarantee sustainable supply over a long period of time.

Kyari, on Monday reportedly said that the sale of petrol at N145 per litre was no longer sustainable with the current foreign exchange.

“We have a very difficult business environment. It is impossible today to import products at the current market price, current fixed foreign exchange,” Kyari reportedly said in Lagos.

The corporation, however, promised to sustain the tempo of petroleum products supply throughout the ember months and beyond across the country at the current rate of N145 per litre.

The state oil firm assured that it had resolved all issues that had to do with foreign exchange stability in order to ensure fuel price stability and distribution.

“Nigerians should not engage in panic buying, as there is no cause for alarm with respect to pump price increase or shortage of products,” it said.

Muhammed explained further that if there was going to be any increase in PMS price, the Petroleum Products Pricing Regulatory Agency (PPPRA) would definitely sensitise Nigerians on it and give reasons for it.

“The statement people are referring to was made within the context of technical explanation, not within the context of downstream operations. A new window to make forex available for marketers for their import needs have been opened and they are satisfied with it,” he said.

Muhammad disclosed that there was already PMS glut in the market, as a lot of products were on ground waiting for off-takers, stressing that there was no payment of petrol subsidy by the government on petrol.

EFCC Re-Opens 2011 Fuel Subsidy Scandal

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The Economic and Financial Crimes Commission, EFCC, has reopened investigations into alleged N10.9 billion 2011 subsidy scam, Daily Trust reports.

Reports have it that the anti-graft body has already been grilling some top officials of the IPMAN Investment Company Limited, a company incorporated by some independent marketers to participate in the importation of refined products into the country in 2011.

This has helped in giving a direction to the probe with invaluable leads currently being gathered to prosecute the case which has questioned the anti-graft war of President Muhammadu Buhari.

The Vice Chairman of IPMAN Investment Company Ltd, who is also the president of IPMAN, Elder Chinedu Okoronkwo, confirmed that he received a letter from the Police Special Fraud Unit, Department of Criminal Investigations, requesting him to release some of his members including the former president, Alhaji Aminu Abdulkadir, and Obasi Lawson for scrutiny.

He a reporter that: “We at the IPMAN secretariat are happy that the authorities are re-opening this case, because as a vice chairman of this company, we are kept in the dark.

“We don’t know when and how the IPMAN Investment Company Ltd imported any product, but all we saw was the release of N10.9 billion as subsidy reimbursement, that is why we started asking questions.

“Let’s keep IPMAN politics aside, this is national issue, let them provide the information and details of how much product was imported, who lifted it, which bank account the marketers paid the money to lift such product, and which bank opened the LC for them to import such product for which they deserved N10.9 billion reimbursement.

“These are the questions we asked Aminu and co but they rather tried to shift attention to another issue,” Okoronkwo said.

FG Pays N48.2bn Subsidy Arrears To Marketers

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The federal government last week paid N48.2 billion outstanding subsidy arrears to oil marketers as claims for 2015 to enable them import petroleum products and meet up with their other financial needs, the Ministry of Finance revealed on Tuesday.

A statement issued by the Director (Information) in the ministry, Salisu Na’inna Dambatta quoted the Minister of Finance, Mrs. Kemi Adeosun to have said that the federal government authorized the Debt Management Office (DMO) to pay the claims less tax liability of N5.171 billion, which was computed by the Federal Inland Revenue Service (FIRS).

“The gross total outstanding subsidy claims accruable to the oil Marketers for 2015 stood at N48, 207, 176, 262.44, while deductable tax liabilities payable to the Federal Inland Revenue Service stood at N5, 171, 186, 373.05 only.

“Giving details of the payments, Mrs. Adeosun stated that Oil Marketers without Tax Liabilities were paid in full, while Oil Marketers with net subsidy claims and FIRS liabilities were paid net claim after deduction of tax liabilities.”

Credit: Thisday

FG Currently Not Paying Subsidy On Petrol- Kachikwu

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Dr Ibe Kachikwu Minster of State For Petroleum on SubsidyThe Minister of State for Petroleum, Dr. Ibe Kachikwu, says the Nigerian government has suspended the subsidy on petroleum products as at today, December 27, as a result of the current low price of crude in the international market.

Dr. Kachikwu said the non-payment of subsidy would remain the same, as long as market trends allow.

He told reporters on Sunday in Kaduna that if crude prices increase, there would be a review which would be tackled under the newly introduced price modulation in the sector.

The price modulation, according to the Minister, is not an outright removal of petrol subsidy.

Credit: ChannelsTv

We Will Focus On Price Modulation, Not Subsidy Removal – Kachikwu

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The Minister of State for Petroleum, Dr. Ibe Kachikwu, said the Federal Government would focus on price modulation of petroleum products to ensure efficiency and provision of the products.

 

Kachikwu said this while addressing newsmen on Thursday in Abuja.

 

He said the price modulation had nothing to do with the removal or existence of subsidy.

 

“There is too much emotion around subsidy issue, but our focus is that the Federal Government should not spend as much as it spends every year on subsidy.

First, it is an issue of irresponsibility; this year we have spent about one trillion and given the state of the finances, we have to save money from every means.

What I am trying to do is to make sure that whatever we do, the poor people will not be affected. So whatever we are going to do will be intellectual,’’ he said.

 

On the way forward, the minister said that the NNPC would review the template of the Petroleum Products Pricing Regulatory Agency (PPPRA) and achieve reduction in the cost for clearing goods.

 

According to him, foreign exchange provisions will be looked into, to ensure stability in the system.

 

He added that efforts were being made to ensure more allocation to the oil industry to ensure certainty in the system.

 

He said that Nigeria consumed below 40 million litres of Premium Motor Spirit (PMS) per day, adding that a reduction in smuggled products would put the level of consumption between 35 and 36 million per day.

 

“If we take this analysis, we can deliver products today with the price of oil where it is and also sell close to the prices we have today.

It is not that we have removed subsidy but the application of market forces will enable you to sell products as close to the prices we have today.

Is it going to be between N87 and N90; we will have to get PPPRA to do those templates and at 35 million (litres) we may sell products at N87; by the time we consume 36, we may be selling at N90 or N91,’’ he said.

 

He said a band had been approved between N87 and N97 to look at price modulation, adding that it would look at price at every given time of crude.

 

The minister said that the price would no longer be fixed, noting that the price of crude would continue to determine what the price of product would be.

 

Kaichukwu said that the report that pump price would go back to N97 in 2016 was not true, adding that a band of N87 and N97might be adopted.

 

“Today the prices are largely close to N87; there might be no need to change the price by January, and it might go up or come down slightly by April.

 

It is all the dynamics of what the crude is; so, I have not put a static figure, myself and PPPRA will sit down and do the calculations and be able to announce what price PMS will sell in January,’’ he said.

 

The Minister added that there was no anticipation of any major shift in regards to the price of crude.

 

On the state of the refinery, he said that as at October, the four refineries performed at zero level but noted that in a few days, the Port Harcourt and Kaduna refineries might be able to bring up some production.

 

He said that the refineries would not be relied on until the state of their maintenance was completed, adding that Federal Government had agreed that it would not sell them at their present state.

 

“We are going to try and repair them; we are going to find external funding to be able to repair them, and my preference is to find somebody who is a technical partner to invest,’’ he said.

 

He expressed hope that two of the nation’s refineries would be at the level of completion in 2016, adding that if Port Harcourt reached 60 per cent completion, it would produce an average of five million barrels.

 

He blamed fall in global oil price, poor contracting, lack of efficiency, funding and even focus to losses in production in the year.

 

Commenting on the Petroleum Industry Bill, he said it would be split into segments to enable passage by the National Assembly.

 

He said that the two segments were fiscal and non fiscal segment, adding that a draft on the non fiscal had been received.

 

 

(NAN)

Subsidy: Controversy Trails Payment Of N413bn To Oil Marketers

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Controversy is now trailing the payment of N413billion to oil marketers, as the Senate, which is expected to give approval to the payment , has claimed that there is no supplementary budget before it for the amount .

The development came just as   the Minister of State for Petroleum Dr Ibe Kachikwu stated that the marketers would be paid next week.

Spokesman of the Senate, Senator Aliyu Abdullahi, yesterday said no supplementary budget for the payment of the N413billion subsidy claims for petroleum marketers has been received from the executive,.

Abdullahi stated this while briefing Senate correspondents in Abuja yesterday.

He said, “With respect to the issue of subsidy, the Senate is surely concerned about it because we are all affected. Nobody is left out because there is no separate filling station for certain category of people.

“If the supplementary budget comes, we will do justice to it. It’s a priority and it will be given expeditious treatment when it is eventually unveiled but that does not mean that action was not being taken.

Responding to a question on whether the 2016 Budget will not be delayed because the Medium Term Expenditure Framework (MTEF) has not been sent to them by the executive, Abdullahi said the budget is a process, adding that the constitution of the Federal Executive Council and the inauguration of the Senate committees this week will facilitate speedy process.

He said, “The three-year MTEF had already been laid before the Seventh Senate but with the coming on board of the new government, there would be reviews and the cabinet is just coming up.

Credit: Leadership

Oil Marketers Call For Release Of N413bn Subsidy Claim

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Some accredited oil subsidy marketers on Thursday said the failure of Federal Government to release the approved N413 billion subsidy debt was disrupting their fuel importation schedule.

 

Speaking in an interview in Lagos, the marketers said that they were concerned that the money had not been released one week after the approval was granted.

The marketers alleged that the delay was affecting loading activities at depots and had led to the shutting down of some filling stations due to non-availability of petroleum products.

“Government, through the Central Bank of Nigeria, has not released any subsidy claims as promised.

“As I am talking to you we have been directed by the CBN to go and meet the Debt Management Office for clarification.

“All our efforts to get the said money have been in vain and to start importing has been a serious problem.

“There is no money to back up the cheques presented to the marketers.

“We do not even know the basis for the clarification of the cheques, but we are aware that there is no money in the account.

“It is like giving the marketers cheques only to discover that there was no money in the account.

“Nothing like importing now because all marketers are angry because of the failed promised,” one of the marketers al

The market said; “If you go outside Lagos you know how much they are selling fuel per litre now, it is the last stock that we are selling now.

“It is unfortunate that the Department of Petroleum (DPR) is saying that we are hoarding the products, which is not the truth.

“We have not collected a single coin from the money.

“If not the fact that some of the marketers are making some money from other products, how do you think we will be able to get anything for now?

“We have been summoned by DPR for a meeting this morning to settle the crisis, we are only managing what we have in stock at present,” he said.

It will be recalled that the Federal Government, had on Nov. 3, approved the sum of N413 billion to petroleum products marketers as the outstanding payment for subsidy claims.

FG Approves 413bn Naira Oil Marketers’ Subsidy Claims

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The Nigerian National Petroleum Corporation (NNPC) says the Federal Government has approved the payment of 413 billion Naira to oil marketers as outstanding payment for subsidy claims.

According to the NNPC, the payment would ensure that there would be no scarcity of the product.

“It is our belief that with the outstanding payment due to Oil Marketers now assured, the marketers and other downstream players will join hands with the NNPC to guarantee that the nation remains wet with petroleum products all year round,” the Corporation said in a statement by the Group General Manager, Group Public Affairs Division, Mr Ohi Alegbe.

The corporation also stressed that it had injected additional volumes into the market, in order to ensure zero fuel queues ahead of the festive season and beyond.

This, the Corporation intends to achieve in collaboration with its downstream subsidiary, the pipelines and products marketing company and other players in the supply and distribution of fuel nationwide.

Credit: ChannelsTV

Subsidy Debt: FG Approves Payment Of N413bn To Oil Marketers

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The Federal Government has approved the payment of N413 billion to petroleum products marketers being the outstanding payment for subsidy claims?, even as marketers insist they are owed about N470billion.
The Nigerian National Petroleum Corporation, NNPC, in a statement in Abuja, also said it has injected additional volumes of Premium Motor Spirit, PMS?, or petrol across the country to boost supply of the product and eliminate the long queues that have resurfaced in many parts of the country.
The statement, signed by the Group General Manager, Group Public Affairs Division?, NNPC, Mr. Ohi Alegbe, noted that the payment of the outstanding N413 billion subsidy claims to oil marketers is part of the Government’s initiative of zero tolerance to fuel queues nationwide.
?Alegbe said: ?”It is our belief that with the outstanding payment due to oil marketers now assured, the marketers and other downstream players will join hands with the NNPC to guarantee that the nation remains wet with petroleum products all year round.”
The Department of Petroleum Resources, DPR, had earlier in the week lamented the fuel supply situation in some states in the country, warning that that any petroleum products depots and filling stations owners engaged in sharp practices would be fined heavily and also prosecuted for economic sabotage.
Director of the DPR, Mordecai Ladan, had in a statement in Abuja, warned oil marketers against products diversion, hoarding, pump manipulation and selling products above government approved prices.
According to Ladan, any petroleum products marketer found to be under-dispensing or selling products above government regulated prices shall be suspended for a minimum of two months.
He said, “Marketers caught diverting or hoarding the products for profiteering shall be sanctioned with a fine of two million naira and have their operating License revoked and prosecuted for national economic sabotage.”
Ladan also stated that the DPR is collaborating with the Petroleum Equilisation Fund (PEF) and the Petroleum Products Pricing Regulatory Agency, PPPRA, to ensure that defaulters are sanctioned accordingly.
To this end, he stated that all DPR offices nationwide have been directed to step up their monitoring activity and ensure full compliance by marketers.

Fuel Scarcity Looms Over Non-Payment Of Subsidy

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The return of long queues at filling stations across Lagos metropolis and some other cities like Abeokuta, Ogun State and Ilorin, Kwara State may have been triggered by the Federal Government’s alleged delay in meeting subsidy payment obligations to oil marketers.

It was gathered yesterday that the fuel marketers were yet to receive subsidy payments which amount to over N300 billion.

Meanwhile, a fresh wind of change has begun blowing in the process of crude oil transactions as the Nigerian National Petroleum Corporation (NNPC) yesterday announced the cancellation of the Offshore Processing Arrangement (OPA) opting for a more efficient Direct Sale-Direct Purchase (DSDP) alternative.

The new DSDP policy, which allows for the direct sale of crude oil by NNPC as well as direct purchase of petroleum products from credible international refineries, would automatically eliminate the activities of middlemen in the crude oil exchange for product matrix.

Credit: Guardian

Oil Subsidy: CNPP Backs President Buhari’s Plan

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Conference of Nigerian Political Parties, CNPP, yesterday applauded President Muhammadu Buhari’s resolve to thread with care the contentious issue of oil subsidy, noting that not yielding to the temptations saved Nigerians from unprecedented agonies and hardship.

National Publicity Secretary of CNPP, Mr. Osita Okechukwu, said in a statement in Abuja that the umbrella body of registered political parties shares with Mr President’s resistance to all manner of temptations to remove the fuel subsidy.

The CNPP however advised that, “For quick-fix, we implore Mr President to enter into partnership with genuine private investors to build refineries in Nigeria. This is the only way to employ millions of our youths, save trillions of Naira and harvest scores of derivative products which manifest from the refineries.”

According to the statement; “We page with Mr President’s resistance to all manner of temptations to remove the Oil Subsidy: as reported, ‘“I have received many literature on the need to remove subsidies, but much of it has no depth,” President Buhari said.

“For the avoidance of doubt, ‘“When you touch the price of petroleum products, that has the effect of triggering price increase on transportation, food and rents. That is for those who earn salaries, but there are many who are jobless and will be affected by it,” the President noted.

“CNPP is of the candid view that President Buhari has the political will to plug most of the leakages, scams and unbridled corruption which enveloped the Oil Subsidy, a supposedly pro-people initiative.

“Removing the Oil Subsidy for us is like throwing away the baby and the bath water; as records clearly show that the fantastic figures gazetted by the Nigerian National Petroleum Corporation (NNPC ) and its agencies in the last five years cannot stand the test of genuine forensic audit.

“Otherwise, what are the justifications for the astronomical rise of Oil Subsidy from N630 billion in 2010 to N2.3 trillion in 2012? Or the deliberate none remittance of 42% of Oil proceeds from 2012 to 2015 to the Federation Account?

“It is on record that the NNPC earned N2.66 trillion in 2013 and paid to the Federation Account Allocation Committee N1.56 trillion, in 2014 earned N2.64 trillion and remitted N1.44 trillion and in 2015 earned N733.3 billion and paid in only N473.2 billion.

“And is not unbridled corruption which botched the $23 billion Greenfield Refineries awarded on 13th May, 2010? These are refineries meant to be located at Bayelsa, Kogi and Lagos states, which could have stopped the huge loss arising from importation of refined petroleum products.”

A Dollar Would’ve Been Exchanged For N500 Without Subsidy- Dangote

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Media men had a piece of Aliko Dangote last weekend. And when they were done many appreciated why he is one of the richest in the world. In an interactive session with senior editors Dangote discussed state of the nation while explaining some details in his businesses that are geared towards a better life for Nigerians.

On oil subsidy he said,

The issue with subsidy is that government needs to block all loopholes. If there’s no subsidy, it will affect our foreign exchange, we’ll end up buying a dollar at N500, because there’s no VAT on petroleum products. That’s why the import of petroleum products is taking about 30% of our foreign reserve. We just need to make sure that there’s no siphoning of money. The refining business requires volume. If you don’t have a massive volume, there’s no way you’ll make money. Most of the refineries in Africa are running at a big loss. It’s not possible for government officials to successfully manage oil businesses. It’s good enough if they remove the subsidy, but you can check with neighbouring countries like Senegal. If a poor person in Senegal can afford to pay subsidy, why can’t a poor person in Nigeria afford to pay. I think there must be something for the masses, which should be in terms of power, social insurance, good education system, good roads etc.

Read More: vanguardngr

Refineries: My Buhari Delivers Death To The Cabal, Change To Nigeria By Dr. Peregrino Brimah

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Daily Subsidy On Petrol Increases To N2bn

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The Federal Government’s daily spending on petrol subsidy may have increased to N2.06bn as the pricing template for the product by the Petroleum Products Pricing Regulatory Agency on Sunday put the subsidy at N51.61 per litre.

Based on daily petrol consumption of 40 million litres, the total subsidy cost on the product as of June 11 would amount to N2.06bn at N51.61 per litre, up from N48.15 on June 2.

Subsidy refers to the money paid, usually by the government, to keep prices below what they will otherwise be in a free market system.

Nigeria, which relies on importation for most of its fuel needs as the country’s refineries are in a poor state, has seen a drop in importation of refined petroleum products in recent months, leading to acute scarcity of the products across the country.

Read More: Punch

ICAN Canvasses Removal Of Subsidy

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The Institute of Chartered Accountants of Nigeria, ICAN, yesterday, advised the newly inaugurated President Muhammadu Buhari administration to remove all perceived or imaginary subsidy which has been a source of huge leakage in the nation’s economy.

ICAN made its position known during the investiture of Otunba Olufemi Deru as the 51st President of the Institute.

In his inaugural speech at the investiture, Deru, who is a former President of Lagos Chamber of Commerce and Industry, LCCI, said that the institute will continue to support government with its professional knowledge and skills in the fight against corruption, money laundering and terrorism financing.

According to him: “These are challenging times in the affairs of our nation when all men of goodwill including accounting professionals must stand up and be counted in the arduous task of rebuilding the fabrics of the nation. We must take the bull by the horn as a nation by taking those hard decisions that will positively impact the welfare of the citizens.”

 Credit: vanguardngr

Subsidy Removal Will Reduce Pressure On Naira- FDC

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Analysts at the Financial Derivatives Company Limited have expressed support for the removal of fuel subsidy saying it would reduce the pressure of the exchange rate of the naira and lead to long term appreciation of the national currency. “More importantly, because there is an inflated import bill due to the subsidy scam, subsidy removal will reduce the pressure on the currency and the naira will appreciate in the medium term”, they said in the FDC Economic Bulletin issued last week.

They noted that removal of fuel subsidy will produce short term gain but long term gain. “Subsidies are reverse taxes and if removed will reduce the disposable income of consumers in the short term. However, it will result in an efficient redistribution in income, spur a rehabilitation of the refineries and an efficient oil industry in the long run; short term pain but long term gain”, they said.

Titled, “Petroleum Subsidy Scam: The Raping of Nigeria”, the bulletin stated, “The benefits associated with a subsidy removal are usually long term which will be solely determined by how the appropriated subsidy funds will be utilized to support optimal productivity within the economy.

“If the subsidy were removed today, the pump price would jump to approximately N130, which is the total open market price when one considers both the landing cost of petrol at N115.77 and the margin for transporters and exporters of N15.49 as of May 10, 2015.1 However, the pump price would be guided solely by global oil prices and would not be at the mercy of oil marketers.

Currently, scarcity initiated by the oil marketers due to delayed pay- ments increased the pump price of petrol. The scarcity created an avenue for arbitrage, with the fuel being sold for as high as N600/ liter in the black market. The impact of the strike and fuel scarcity was severe, and almost crippled economic activities, as banks and even telecom operators had to reduce their operating hours due to the scarcity of petroleum products.

This situation could be averted if the issue of subsidy is addressed and put to rest. But addressing fuel subsidy is just one part of the hydra-legged problem in the oil and gas sector. The passage of the PIB and a deregulation of the sector are required to fully enjoy an efficient oil and gas industry. In the long run, subsidy removal will assist the government financially and create a path to addressing the problems in the oil sector.”

Credit: Vanguard

Okonjo-iweala To Buhari: You Must Do Something About Oil Cartel

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Nigeria’s finance minister, Ngozi Okonjo-Iweala has set an agenda for the Buhari administration: to tame urgently the oil cartel holding the nation to ransom.She spoke in Abuja today to refute the claim by the oil marketers that the nation is owing them another N200.2bn, just after the government paid them N156bn.

She said by government’s computation, the outstanding amount is about N131bn billion.Okonjo-Iweala urged the marketers to be patriotic in their decisions by considering the interest of Nigerians who always bear the brunt of their actions, noting that they should not by their actions hold the country to ransom.The marketers had claimed that the government’s indebtedness to them for oil subsidy was about N354,4bn.

Confirming the figure, the Executive Secretary, Major Oil Marketers Association of Nigeria,
Mr.Thomas Olawore, had said, “The government had paid N154.2bn out of N354.4bn and we areleft with a balance of N200.2bn.“What happens to the N200.2bn? That is why we requested that the government invite us sothat we can be told how it intends to liquidate the remaining N200.2bn.

But the minister said this figure could not be correct, noting that the balance that is left based on Petroleum Pricing Products Regulatory Agency’s template is about N131bn.She said, “As you know, we paid N156bn recently, N100bn of the principal payment that we owe them and then we paid N56bn interest rate and some remaining exchange rate differentials.“Prior to that, we have just paid N31bn exchange rate differentials. So at the time we paid that last week, what we had outstanding is N98bn.”According to her, every week, the Petroleum Products Pricing Regulatory Agency sends data and that is what government only subscribe and certified as what is due to marketers.“As at now, since we made the announcement last week, it has now risen from N98bn to N131bn outstanding in principle payment.“And they are now making a demand of N200bn and I asked them what is the balance for,” she added.

She likened the oil marketers to a small cartel that are into a no risk business based on template negotiated with PPPRA long time agowhich factored in exchange rate differential, and profit margin guarantee.This situation, she said, leaves them with absolutely no risk.She said. “It has become a situation where we have a cartel that can ground the nation to a halt at will. I strongly suggest that the nation has to do something about it.

Source: PMNews

The Return Of Sai Baba By Tony Ademiluyi

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History has been made in the most populous black nation in the world with the election of General Muhammadu Buhari as President of Nigeria. This is the first time since independence that an opposition leader is defeating an incumbent leader. How did this ‘impossible feat’ happen?
President Jonathan was a reluctant boss who became Governor, Vice-President, Acting President and President accidentally. His first name really saw him through without his ever having to contest an election. The first election he contested for on his own steam was in 2011 when he regaled the nation with the tale of his having gone to school without shoes. What he lacked in charisma and colour, he made up with his apparent humble mien and the widespread appeal of his grass to grace story. He swept the polls in the six geopolitical zones of the country. In the south-west for instance he won all the states except Osun. He won five states in the North-Central with the exception of Niger and a substantial number of states in the North-East. Why did he suddenly become so unpopular for him to have only won convincingly in the south-east and south-south?
His decision to yank off petroleum subsidy on January 1, 2012 was clearly anti-people. That was a terrible way to start the New Year with many people especially the easterners still trapped in their villages. This led to the Occupy Nigeria movement that spread rapidly like wild fire using the instrumentality of the social media. Protests were held in major cities like Abuja and Lagos. The Freedom Park in Ojota, Lagos became the hotbed of the fight for the common man. The rich and the poor alike were united in this noble struggle. Prominent artistes lent their voice to the campaign. What irked the populace was the loss of lives of some of the protesters and the insensitivity of the Jonathan led government to hold a town hall meeting in faraway New York in America. This was blown out of proportion by Sahara Reporters and it went viral provoking anger in the land.
Corruption in a magnitude that had never been seen before was apparently tolerated by the Jonathan led government. There were mind boggling allegations of massive corruption leveled against the petroleum minister, Diezani Allison-Maduekwe. Her alleged spending of ten billion naira on private chartered jets, mansions abroad and missing funds in the petroleum sector running into billions of dollars stirred up rancourous debates in the land. Jonathan did nothing to institute a probe of these allegations of his kinswoman. When former Aviation Minister, Princess Stella Oduah who played a key role in the 2011 elections through the neighbour to neighbour campaign was discovered to have purchased two vehicles with 255 million naira, it took severe public pressure to have her dropped from his cabinet. She was never invited by the Economic and Financial Crimes Commission for questioning let alone being prosecuted for corruption. To add salt to the injury, she is now the Senator-Elect for Anambra North Senatorial District. It was discovered that the President himself acquired about ninety hectares of land in Abuja for the purpose of farming. This was a clear conflict of interest as he was still in power. How did he get the funds to acquire the land? He further angered Nigerians when he failed to declare his assets and said he didn’t give a damn about what Nigerians felt about it on national television. This was the hubris of pride at its apogee. In February 2014, Sanusi Lamido Sanusi the then Central Bank Governor wrote a letter to him alleging that $20 billion of Nigeria’s oil revenue was not remitted to the federation account. Rather than investigate the allegations, he suspended him and eased him out after his tenure expired. Sanusi not only left office with a high approval rating after cleaning the Augean stables in the banking sector that nearly collapsed, he later became the Emir of Kano – one of the most influential traditional rulers in the country. It is no surprise that Kano gave Buhari the highest number of vote in the country – 1.9 million. He made the former militants extremely wealthy by giving them pipeline protection contracts which ran into millions of dollars surreptitiously usurping the function of the navy. He went ahead to grant a controversial Presidential Pardon to his ex-boss and former Bayelsa State Governor, Diepreye Alameiyeseigha thereby making a mockery of the anti-corruption campaign and caused deep resentment across the country.
The boko haram insurgents have slaughtered well over twenty thousand people leaving about three million internally displaced. Jonathan’s tackling of the crisis was seen globally as lacklustre. When the girls in Chibok were abducted last year April, he initially refused to visit the place of the abduction which was the height of insensitivity. Dame Patience Jonathan, the First Lady made a cruel joke when she told a principal of the affected school ‘Na only you waka come?’ which went viral and portrayed the first family as insensitive. He was later photographed celebrating his niece’s lavish wedding just a few days after the boko haram insurgents killed 200 people in Baga, a town in Borno state. The election was postponed by six weeks to enable the dicey security situation to improve. Even though most of the areas taken by boko haram were recaptured, it was seen as coming too late.
Jonathan made the costly error of alienating Obasanjo and some key leaders of the PDP who were to later work against his second term bid. Obasanjo was so embittered that he wrote a public eighteen page letter containing criticisms of his government in December 2013. Rather than make peace with the man fondly known as Baba Iyabo, his office retaliated and the boom writings by the retired General continued. It later culminated in his resignation from the party where he publicly tore his membership card. Senator Bukola Saraki was alienated from the party which saw him defect him to the opposition APC. Kwara was among the states that the General got in his kitty. The defection of Senators George Akume, Barnabas Gemade and Samuel Ortom a former Minister of State for Trade and Investment in Jonathan’s government which saw Benue fall into the hands of the Daura born General. Kogi state despite being a PDP state fell into the hands of the APC because of the influence of the likes of Dino Melaye, Abubakar Audu and some other rebels who jumped ship. The disenchantment of the people of the south west led them to shift their loyalty to the APC a far cry of what obtained in 2011.
It is up to the General to unite the greatly divided country and to be truly magnanimous in victory. There should be the avoidance of vindictiveness which will do nothing but bring the nation backward and concentrate on the arduous task of nation building.
Congratulations General!
Tony Ademiluyi

Views expressed are solely that of author and does not represent views of www.omojuwa.com nor its associates

Why I Refused To Devalue Naira, Remove Fuel Subsidy – Buhari

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The All Progressive Congress (APC) presidential candidate Muhammadu Buhari said he refused to remove subsidies on petrol and devalue the naira when he was head of state because it would destroy the economy.

Buhari, who spoke during a town hall meeting in Abuja on Wednesday, said he refused the bidding of the world super powers to save the country.
He said the nation has lost greatly from the devaluation of the currency in terms of growing the economy and creating employment for the youth as employers who had to take bank loans to import raw materials and machines are running their industries at a loss.

?”When we came into power in December 1983, we were approached by the world power at some stage to devalue the naira, remove petroleum subsidy and remove subsidy on flour, but we refused,” he said.
He explained that “the issue was that if we get plenty of naira, what are we going to do with it? We even stopped farming and the only thing we get money from them was oil and that was being paid in dollars.”

He said “if you have excess of groundnut, cocoa, cotton or palm oil, you sell it in foreign exchange. If you devalue the currency, the naira will be affected and Nigerians will not get value for their goods and services.”

The APC flag bearer said “I was told to remove subsidy on petroleum and because I had the honour of being in charge of petroleum for three and half years, I don’t know in terms of Nigeria, who is subsidising who.”

“To the best of my knowledge then, the Nigerian petrol and Nigerian capital was used to develop the refineries up to the time I was there. We built the refineries from one of 50,000 bpd to four of 450,000 bpd, laid pipelines of over 3000 kilometres, built more than 20 depots with all Nigerian money,” he said.

He added that no money was borrowed to develop the infrastructure in the oil sector.

Petroleum Subsidy Hits N1.2bn

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The subsidy on petrol that the Federal Government will pay has hit 1.2 billion naira after it slashed the price of the product by N10 per litre on January 18, 2015 according to figures from the Petroleum Products Pricing Regulatory Agency (PPPRA).

The PPPRA, stated that the Expected Open Market Price for petrol, which is the summation of the landing cost plus the subtotal margins, was N101.50, as against the approved retail price of N87 per litre.

This showed that the government will pay about N14.5 as subsidy on every litre of petrol consumed in the country in the past two days that the price of Brent averaged $61 per barrel.

Read More: Punch