OrderPaperToday – The Senate on Wednesday gave approval for the payment of outstanding subsidy claims to the tune of N348 billion to Oando, Total, Honey Well, Capital Oil, Conoil, A.A. Rano, and 68 other petroleum marketers.
The approval is sequel to a letter on Promissory Note Programme and a Bond Issuance to Settle Inherited Local Debts and Contractual Obligations to Petroleum Marketers sent by President Muhammadu Buhari to clear up outstanding liabilities, debts, interest accrued and forex differential from previous government.
While 55 oil marketers will receive N275,750,415,108, 19 others will get N73,452,639,866.
The Chairman Senate Committee on Petroleum (Downstream), Senator Kabiru Marafa, presented the interim report while stressing that continuous delay of the approval of the promissory note request will affect the liquidity of the oil marketing companies and undermine their crucial role in the development of the economy.
Other resolutions approved by the red chamber include continuous engagement with the Ministry of Finance, oil marketing companies, Petroleum Products Pricing Regulatory Agency (PPPRA) and other stakeholders.
Marafa in his presentation said the marketers claimed N670,497,543,15, as of June 30, 2017, but the PPPRA verified and approved the sum of N429,054,203,228 to the Federal Ministry of Finance.
But the verified figure approved by the Federal Executive Council was reduced by Presidential Initiative on Continuous Audit (PICA) to N407,255,263,288 after a several verification processes.
The report read: “This issue including The determination of the terminal date of the subsidy programme amount paid to the OMCs and the interest accrued from 30th June, 2017 to date will be taken up and resolved in the final report. This committee will be submitting to the Senate in due course. This submission should be able to reconcile and bring to the conclusion all issues in respect of petroleum subsidy programme implementation and payments;
“Further verification needs to be made to ascerTain the discrepancies between the OMCs and the recommendations for payment made by FMoF (PICA);
“In this respect, Thye Committee is of the opinion that interim payments should be effected to the OMCs pending full verification of PICA recommendaTions and updating on the full implication of interest accruals from 30th June 2017 to date.
“The Government’s inability to pay the OMCs as at 30th June, 2017 has further increased its liability since the interest continued running till date, hence, the need for further work by the Committee to compile and update the level of indebtedness and its interest accruals;
“However, in view of the fact that the service of the OMCs is very important to the economic development of the country and closely tied to National security, paying the marketers would stem the threat of fuel scarcity, increase economic activities and promote a more harmonious working relationship between the Government and OMCs”.
The following are the amount approved for some of the oil marketers: Aiteo N4,988,199,360; Conoil N5,588,285,132; Forte Oil N15,480,445,907; Bovas N5,953,684,258; Capital Oil N8,339,052,402; Mobil N8,282,363,478; MRS Oil and Gas N20,948,270,002; Oando N14,972,585,600; Total N21,569,996,843, among others.
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