Senate Committee summons Petroleum Minister over fuel scarcity

The Senate Committee on Petroleum Resources (Downstream) on Friday invited the Minister of Petroleum Resources, Diezani Alison-Madueke and the Group Managing Director of the Nigeria National Petroleum Corporation (NNPC) Andrew Yakubu, to a meeting on Tuesday to explain the reasons for fuel scarcity experienced in several cities across Nigeria.

The Minister of Petroleum Resources, Diezini Alison-Madueke

The committee also invited the Executive Secretary of the Petroleum Products Pricing Regulatory Agency (PPPRA), Reginald Stanley along with other stakeholders in the petroleum downstream sector.

The Chairman of the committee, Magnus Abe, who personally signed the invitation letter, said the long queues of vehicles at filling stations noticed this week in Abuja and some cities in the country especially in Lagos “is unacceptable”.

He said “We thought that the era of Nigerians queuing at filling stations for indeterminate hours to procure PMS and other petroleum products, was indeed gone forever. It is, indeed, an embarrassment that precious man-hours are wasted in the quest to fulfil a basic need.

“What was initially perceived as a glitch in the distribution chain has now ballooned into queues in what now seems to be a gradual return to that inglorious era.

“The Senate Petroleum Resources Committee intends to engage those in charge with a view to ascertain and chart workable solutions to the challenges in the downstream sector.

“To this end, we will meet with the Petroleum Resources Minister, the NNPC GMD, PPPRA and other relevant stakeholders next week.”

NNPC says there’s enough fuel for next 30 days as scarcity hits Abuja

The management of Nigerian National Petroleum Corporation (NNPC) has said that it has 30 days stock of petrol for distribution nationwide and cautioned against panic buying by consumers.

The General Manager, Media Relations of the corporation, Omar Ibrahim said this on Monday in Abuja and debunked insinuations that the Federal Government had increased the price of fuel.

He said that the artificial scarcity presently experienced in Abuja and its surroundings might have been instigated by some oil marketers.
“I can tell you that the Federal Government has not increased the price of fuel. This scarcity might have been instigated by these oil marketers who have disagreement with government.

“The NNPC through the PPMC has ample supply to last 30 days to the whole country,” he said.

The Federal Capital Territory (FCT) was on Monday hit by another fuel scarcity, as long queues were noticed in most filling stations in the city.

Two weeks ago, the National Union of Petroleum and Natural Gas Worker (NUPENG) withdrew their services and refused to supply petroleum products to Abuja, to protest Federal Government’s non-payment of outstanding subsidy for fuel imported by oil marketers. This led to a shortage of petroleum products which practically shut-down normal business activities in the Federal Capital Territory (FCT).

No official explanation has been offered as to the real cause of the latest scarcity, which began to manifest late Monday evening.

The crisis has reportedly fuelled the emergence of the ‘black market’, with 10-litre keg of petrol sold for N3, 000, as against the normal price of N970.

Investigations showed that most of the oil marketers have run out of stock of the product and consequently increased the pump price of the product at their filling stations.

Mr Ibrahim said it was only the NNPC that had been importing fuel into the country since the beginning of the year as the marketers had stopped over their subsidy payment.

He said the NNPC was fast-tracking the process of supply of the product to its various depots in Lagos, Calabar, Warri and Port Harcourt.
He expressed optimism that the situation would soon be resolved so that the marketers could complement imports by NNPC.

We’re not going on strike for oil marketers but for workers – NUPENG

The president of  the National Union of Petroleum and Natural Gas Workers (NUPENG), Achese Igwe has argued that the industrial action threatened by the union is not for the payment of oil subsidies to fraudulent oil marketers but to secure the payment of  salaries to workers in the sector.

Mr. Igwe was on Channels Television’s breakfast show, Sunrise Daily, to explain the reasons for the impending strike which has already grounded the Federal Capital Territory, leaving the residents to resort to black market for fuel.

The Minister of Finance, Ngozi Okonjo-Iweala, recently alleged that the oil workers union was working in connivance with the oil marketers to blackmail the federal government over the payment of fuel subsidy.

The union leader however accused the federal government of non-compliance to earlier agreements with the union which included agreement on subsidy payments, repair of bad roads across the country plied by oil distributing trucks and refinery maintenance.

According to Mr Igwe, some of the workers in the sector are currently being owed salaries for over three months.

Reacting to the planned strike by NUPENG, the spokesman for the Civil Liberty Organsation, Abah Ejembi speaking from Channels Television’s Abuja studio, urged the union not to put the lives of over 160 million Nigerians at risk with the struggle for their union members,  that number about 15,000 by compelling the federal government to pay the subsidy claims that are shrouded in fraud.

Mr. Abah Ejembi claimed that NUPENG is fighting the battle for their ‘bosses’-the oil marketers who are entangled in allegations of fraudulent claims in the management of the nation’s fuel subsidy regime with the Ministry of Finance.






N42.666 billion paid to oil marketers in 4months-Finance Ministry

The federal government has again restated its claim that indicted oil marketers are behind the industrial action being embarked by the National Union of Petroleum and Natural Gas workers, (NUPENG).

The union has stopped the delivery of petrol to the FCT in protest over the alleged non-payment of subsidy claims causing severe fuel shortages in the nation’s capital.

But the Federal Ministry of Finance in a statement on Friday stated that the federal government has already paid out the sum of N42.666 billion in subsidy claims between the months of April – August this year to ‘genuine oil marketers.’

The statement which sought to apprise Nigerians on key developments in the management of fuel subsidy payments, claimed that “marketers with legitimate and unencumbered claims have been paid and will continue to be paid.”

Giving a breakdown of the payment made so far, the statement revealed that:

-Between April and May 2012, Batches D/12 and E/12 involving 14 oil marketers with a claim of N17 billion were fully settled.

– In addition, since early July 2012, N25.6 billion worth of claims have been fully settled.

– In all, between April – August this year, in respect of 2012 PMS claims, N42.666 billion have been paid to 31 oil marketers.

Affirming that the fuel scarcity in Abuja is a ploy by the indicted marketers to provoke Nigerians against the government, the Ministry of Finance alleged that “it is clear that those behind the strikes are marketers being investigated for possible fraud.”

“These elements have now resorted to hiding behind the unions to unnecessarily antagonize government and create hardship for Nigerians” the statement adds.

Companies under investigation for fuel subsidy fraud

The statement further revealed the names of 20 companies that are currently under-going investigation based on their indictment by the Presidential Committee on Fuel Subsidy Payments led by Mr Aigboje Aig-Imoukhuede.

According to the Ministry, the companies are been investigated “based on evidence that they may have engaged in fraudulent activities under the fuel subsidy regime.”

The report of the committee recommended that the oil marketers must refund various amounts to the national treasury.





















Less indictment

The Finance Ministry also noted that there are other oil marketing companies with less severe cases to answer, adding that “these (companies) are in discussion with government for a quick resolution of their issues.”

Explaining the terms under which funds owed these companies will  be sorted out, the statement said, that oil marketers under investigation for possible refunds to the government, will have their 2012 outstanding claims “netted out against their expected refunds to government and those with a positive net balance, i.e outstanding claims greater than expected refunds will be processed and paid.”

“For marketers with a negative balance with government, i.e they owe government more in refunds than government owes them, the Aig-imoukhuede committee will accelerate review of their documents after the Sallah break so that their claims can be processed and settled, if cleared, without further delay.”

“For others that may not be in the above categories but who have other issues or claims, their claims will also be attended to with the same despatch.”

In conclusion the Ministry of Finance vowed to investigation the alleged role of the oil marketers in the on-going crisis stating that “we want to make it clear that Government will fully investigate their activities and if found guilty, bring them to book and recover all public funds fraudulently obtained, in the guise of fuel subsidy claims.”

“No degree of blackmail will stop the Government from doing its work. Government will, therefore, pursue justice and ensure that those who are found guilty are appropriately sanctioned” it concluded.

Don’t panic, there is enough fuel for all – Minister of Petroleum

The Minister of Petroleum Resources, Diezani Alison-Madueke, on Thursday allayed fears that the nation could be thrown into another bout of fuel scarcity explaining that there is enough fuel in reserve within the country to last 40 to 45 days.

Minister of Petroleum, Diezani Alison-Madueke

The Minister made this clarification at the inaugural meeting of the newly constituted Board of the Nigerian National Petroleum Corporation.

She explained that the artificial hitch in distribution currently being experienced has nothing to do with shortage in supply but unresolved issues between the Ministry of Finance and petroleum marketers.

The Minister expressed optimism that the issue will be resolved soon as the federal government was in control of the situation.

Long queues for fuel have increased across fuel stations in the Federal Capital Territory following the disagreement between the federal government and some major fuel marketers over subsidy payments.

An industrial action by oil marketers commenced on Wednesday, because some of them were yet to be paid money for subsidized oil importation by the government.

A trip around the town by Channels Television’s correspondent revealed empty streets with most cars parked at petrol stations.

Most petrol stations were not dispensing fuel as they claim the National Union of Petroleum and Natural Gas Workers (NUPENG) has refused any tanker from coming into Abuja.

The government halted the payments of subsidy claims following the indictment of some of the marketers by the fuel subsidy investigation committees.

Fuel scarcity grips Abuja

Long queues for fuel has increased across fuel stations in the Federal Capital Territory following the disagreement between the federal government and some major fuel marketers over subsidy payments.

An industrial action by oil marketers commenced on Wednesday, because some of them were yet to be paid money for subsidized oil importation by the federal government.

A trip around the town by our correspondent revealed empty streets with most cars parked at petrol stations.

Most petrol stations were not dispensing fuel as they claim the union has refused any tanker from coming into Abuja.

The government halted the payments of subsidy claims following the indictment of some of the marketers by the fuel subsidy investigation committees.

However, the federal government on Wednesday confirmed that a total of N42 billion has been paid to 31 oil marketers between January and August, and that the intention of the indicted oil marketers is to blackmail government to avoid sanctions on crimes

According to the Minister of State for Finance, Yerima Ngama, the oil marketers planning to embark on a  strike are those who have been indicted by the Aig-Imoukhuede report on fuel subsidy payments.

NUPENG’s reaction

Meanwhile, the National Union of Petroleum and Natural Gas Workers (NUPENG) has denied the government’s claim and alleged that officials  of the Ministry of Finance are not telling Nigerians the truth.

Speaking at Channels Television’s studios in Abuja, the Chairman of the oil and gas branch of NUPENG, Benneth Korie, accused the Ministry of Finance of employing underhand tactics by insinuating that the oil workers’ strike is being instigated by blacklisted oil marketers.

Mr Korie explained that NUPENG’s industrial action is informed by the government’s failure to keep to its side of a bargain reached over payments to jetty and depot owners


Presidential committee says 21 firms stole N382 billion subsidy money

Twenty one oil marketers were on Tuesday indicted for fraudulently collecting N382 billion last year in subsidy payments for fuel that was never delivered.

Aigboje Aig-Imoukhuede, the Chairman of the Presidential Committee set up on the 2011 fuel subsidy scheme disclosed this while addressing journalists after submitting the final report to President Goodluck Jonathan.

“The first (step) is the recovery of the N382 billion,” Mr Imokhuede said.

The probe commissioned by Mr Jonathan is the latest in a string of investigations into fuel subsidy scheme that is rife with corruption and a massive drain on the country’s finances.

“The next is possible criminal investigation and prosecution of the OMT (oil marketing and trading companies) … also, the external auditors and any government functionaries who served will be further interviewed to determine the roles if any in the issues that were discussed.”
Mr Imokhuede did not name specific companies but some of the world’s largest oil traders import petrol into the country, along with marketers owned by some of the richest and most powerful Nigerians.

Nigeria is among the top 10 crude oil exporters in the world but due to decades of corruption and mismanagement it has to import most of its refined fuel needs.

The Federal Government scrapped payment of fuel subsidy on January 1, potentially saving the country over $6 billion. But more than a week of strikes and protests erupted across the country against the higher cost of fuel, forcing the government to partially reinstate subsidy payments.

The first probe

Following the protest against the removal of fuel subsidy, the House of Representatives constituted an ad-hoc committee chaired by Farouk Lawan to probe the the scheme earlier this year.

Mr Lawn’s committee uncovered fraudulent payments over three years of about N1.7 trillion.

But now his committee’s report is being called into question over allegations that Mr Lawan demanded, and took part of, a $3 million bribe from the Chairman of Zenon oil and Gas, Femi Otedola in order to remove his company from the list of fraudsters.

Mr Lawan’s lawyer said the lawmaker took $500,000 offered to him by Mr Otedola, but only in order to expose him, saying he disclosed the bribe to the Chairman of the House committee on Drugs/Narcotics and Financial Crimes, Adams Jagaba and handed the cash to him.

Mr Lawan’s report not only highlighted the oil marketers’ crimes but also pointed the finger at high level politicians, including Oil Minister Diezani Alison-Madueke.

Mr Imokhuede’s committee has focused on oil companies rather than government officials.

Another fuel scarcity looms

The Ministry of Finance has held off subsidy payments until probes into marketers have been completed, prompting anger from importers and risking fuel shortages.

The Fuel union Jetty and Petroleum Tank Farm Owners of Nigeria (JEPTFON) is shutting down fuel distribution facilities this week and another labour group, the Depot and Petroleum Marketers Association (DAPPMA), threatened to join them within 48 hours if government did not pay outstanding subsidies.

The subsidy is stretching Nigeria’s finances and draining oil savings. The Minister of State for Finance, Yerima Lawan Ngama said in June that only had N370 billion is left to pay subsidies, out of the N888 billion in the 2012 budget.

The Central Bank has said the subsidy budget will run out well before the end of the year, which means they will need to raid savings to pay for it.

State governors under the aegis of Nigeria Governors Forum have said they will take the federal government to court for what they call “illegal” over-budget subsidy payments.

Fuel scarcity looms as petroleum marketers threaten shutdown

Petroleum products marketers under the aegis of Jetties and Petroleum Tank Farms Owners of Nigeria (JEPTFON) have threatened to shut down operations with effect from Monday next week if government does not rectify the subsidy payment process.

The marketers, who ventilated their grievance over the federal government’s unilateral action to withhold payment of subsidy, said the action of government was threatening the continued survival of their business and the larger economy.

In a communique issued at the end of an emergency meeting in Abuja on Friday, the Executive Secretary of the association, Enoch Kanawa said the withdrawal of subsidy payments is also a clear breach of contractual obligations, insisting that outstanding payments to subsidy claims should also be paid in full.

The jetties and tank farm owners also described as unacceptable the unguided statements by government officials labelling members of its association as fraudulent and irresponsible, demanding immediate apology.

Fuel scarcity hits Nigerian aviation

Many flights have been cancelled at airports across the country as airlines can not meet up with their scheduled flights, due to the aviation fuel scarcity.

Passengers were stranded in airports at the weekend as there were no aircraft to convey them to their various destinations; many of them had to return home or seek alternative means of getting to their destinations.

The airlines that managed to operate, ended up having their passengers delayed for more than six hours while most airlines cancelled their flights as a result of the scarcity and high price of aviation fuel.

The Assistant Secretary General of Airlines Operators of Nigeria (AON), Mohammed Tukur condemned the situation saying “this is the time airline operators should be wary of what is sold to them as aviation fuel…this is the period kerosene could be sold to unsuspecting carriers in the name of aviation fuel.”

A Nigerian newspaper learnt that some foreign airlines headed Accra, Ghana to get fuel to operate their aircraft because the commodity is cheaper in Ghana as a litre sells for between N200 and N210, depending on where it was bought.

Fuel Scarcity looms as petroleum workers threaten strike

Another round of fuel scarcity looms as the National Union of Petroleum and Natural Gas Workers (NUPENG), on Sunday in Abuja gave the Federal Government a 72-hour deadline to intervene in its dispute with some banks or face a nationwide strike.

The General Secretary of NUPENG, Elijah Okougbo, said in a communiqué issued by the union that the impending strike had to do with disagreement over loan obtained by Jetty and Petroleum Tank Farm Owners Association of Nigeria from some banks, to satisfy the demand for fuel importation.

The union in its strike notice threatened to shut down vital oil services if the government refused to intervene.

NUPENG is demanding the implementation of a section of an agreement reached with the Federal Government to allow JEPTFON, a subsidiary association, to pay back the loan in 15 years with three percent interest.

Mr Okougbo said the Federal Government had ignored implementations of both demands contained in the agreement reached with the union and that the union was compelled to issue the ultimatum because the banks were mounting serious pressure on JEPTFON to repay the loan in spite of the agreement reached with the Federal Government.

The union’s Secretary said NUPENG would not give any further notice to the Federal Government before proceeding on the nationwide industrial action.
He said member associations of the union had been compelled to embark on a drastic reduction of their workforce in the drive to repay the outstanding loan stressing that MRS, one of its members sacked 100 workers because of the loan issue.

He said since the 72 -hour ultimatum was issued to the Federal Government, the union had not received a response from the government apart from the State Security Service which advised them against it because of the prevailing security situation in the country.

He said, letters written to the Office of the Secretary to the Government of the Federation, the Minister of Labour and Productivity, the Group Managing Director of the Nigeria National Petroleum Corporation, the National Security Adviser, the Executive Secretary of the Petroleum Products Pricing Regulatory Agency and other critical offices on January 10, 2012, did not yield any result.

He said, “If nothing is done to consider the satisfactory implementation of the committee reports, we will have no choice but to resume our suspended nationwide strike without further notice in order to save the livelihood of our members as injury to one, is injury to all.”

Fuel Scarcity:Senate to meet Marketers,Agencies,Financial Houses

To address the controversial fuel scarcity looming around the FCT and its neighbouring states,the Senate has directed the Minister of Finance to arrange a meeting which will include oil marketers,finance houses and agencies in the petroleum sector.

It is coming as a consultative meeting to get the facts responsible for the unnecessary scarcity.