Unpaid Subsidy: Diezani, NNPC Report Okonjo-Iweala To Jonathan


Nigerian National Petroleum Corporation has alerted President Goodluck
Jonathan  to  a looming acute  fuel shortage  if the
Federal Government fails to pay N1.13trn subsidy  owed it (NNPC), The PUNCH learnt. The NNPC top management, led by the
Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke, and the
corporation’s Group Managing Director, Mr. Andrew Yakubu, reportedly made this
known to Jonathan at a recent meeting.

Our correspondent learnt that team
told the President  that  the Minister of Finance, Mrs. Ngozi
Okonjo-Iweala,  had  failed to pay the  debt.

 At the meeting, the corporation
was said to have hinged its capacity to continue the importation of fuel on the
payment of the debt  which had accumulated over the months.
The NNPC, The PUNCH learnt, told the President that fuel
might disappear from filling stations across the country if 
government  failed to pay the debt. This is in addition to the fear that
the N971bn subsidy provision in the 2013 budget is seen as grossly inadequate.
 “Yes, we have made a
presentation to the President. We are waiting for his response because it
(payment of the subsidy claim) is very imperative for our capacity to import
fuel ,” a source at the NNPC, who was privy to discussion at the meeting
told  one of our correspondents.
Alison-Madueke and the NNPC management
were said to have requested for the meeting with the President after their
failed attempts to make Okonjo-Iweala pay the subsidy claim.
 The corporation has remained the
only importer of fuel since the controversy  over the payment of subsidy
claims to importers commenced. Oil marketers have refused to import the product
because the government has  declined  to pay  some claims which
the government  described as  spurious.
 Attempts to speak with  the
NNPC Acting Group General Manager, Public Affairs , Mr. Fidel Pepple, on the
meeting with the President proved abortive as he  did not answer his
telephone  calls. He also failed to respond to text messages sent to his
phone on the matter.
 However, Pepple in June had
confirmed in an interview with Reuters that the
organisation owed N1.13trn in subsidy arrears.
He had said, “As at the end of May
2012, NNPC had unpaid claims of N1.134trn.
“We are concerned about the shortages
but just to put it on record, NNPC has been the only organisation importing
products since January when the fuel subsidy issue began.”
 Okonjo-Iweala’s Senior Special
Assistant on Communications, Mr. Paul Nwabuikwu, did not pick his call either.
He also did not respond to a text message sent to his mobile phone on why the
ministry had not paid the  subsidy claims.
 Oil marketers under the Jetty
and Petroleum Tank Farm Owners have however  faulted the N971bn budgeted
for the subsidy in the 2013 fiscal year.
The group said the amount would not be
enough to guarantee adequate supply of petroleum products.
 The Executive Secretary,
JEPTFON, Mr. Enoch Kenawa, said this during a telephone interview with one
of  our correspondents. 
He said, “It (N971bn) will not be
adequate. What the government is doing is putting Nigerians in double jeopardy.
They said they are subsidising fuel, yet people can’t see the products to buy
and where they have fuel, people still pay very high to get it.
 “The N971bn for fuel subsidy can
never be adequate. At 35 million litres of fuel consumption per day, the money
can’t be enough.”
He said rather than N971bn, the
government should have provided for between N1.2trn and N1.5trn, based on 
the current consumption pattern.
  “If they want to remove, let
them remove it (subsidy) instead of what they are doing right now. Based on the
demand, the amount that would be reasonable for fuel subsidy should be between
N1.2trn and N1.5trn,”Kenawa added.
 He attributed the fuel scarcity
in many parts of the country to the N888bn voted for subsidy this year, which
was not enough.
 The Federal Government had in
January announced the total removal of subsidy on petrol and consequently hiked
the pump price of the product from N65 to N141.
 The government, however, reduced
the price to N97 following mass protests organised by labour unions and civil
society groups.
 The  protest also inspired
the House of Representatives to institute a probe into the subsidy regime. The
committee headed by Mr. Farouk Lawan had found widespread abuse of the subsidy
regime. The committee’s report indicated that the country had been
short-changed to the tune of N1.7trn under the subsidy regime.
 Although the report was tainted
by allegations of bribery against Lawan by an oil marketer, Femi Otedola, the
Economic and Financial Crimes Commission has started the prosecution of some of
the oil marketers indicted by the report.


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