After over two years of agitation by the oil marketing and trading companies for the payment of their outstanding subsidy claims that arose from the old subsidy regime, the Senate Wednesday approved the payment of N348.003 billion to 74 companies as outstanding fuel subsidy claims owed them by federal government as at June 30, 2017.
The approval is sequel to the presentation at the plenary of a 14-page interim report of the Committee on Downstream Petroleum Sector by the Chairman, Senator Kabir Marafa, on promisory note programme and a bond issuance to settle inherited local debts and contractual obligations to the petroleum marketers.
The payment, according to the Senate, would be through promisory note programme and bond issuance to settle inherited local debts and contractual obligations to the 74 oil marketing companies .
A breakdown of the 74 companies shows that 55 oil marketers are to be paid verified figures against their names, while 19 others with contentious claims are to be paid 65 per cent of their claims, pending further investigation.
The oil marketers and the amount verified and approved against their names include Folawiyo Energy, N7.56 billion; Mobil, N8.28 billion; Total, N21.56 billion; Techno Oil, N10.19 billion; MRS Oil and Gas, N20.94 billion; Northwest Petroleum, N17.24 billion; Rainoil Limited, N12.71 billion; Obat Oil, N2.90 billion and Integrated Oil, N6.53 billion.
Those with contentious claims and the amount include: Conoil, N5.58 billion; Forte Oil, Plc N15.48 billion; Oando Plc, N14.97 billion; Swift Oil, N6.13 billion; Blacklight, N7.25 billion; IPMAN Investment, N1.22 billion and Tempopgate Oil, N2.12 billion.
Senator Marafa had earlier, while presenting the 22- man Committee report, said his committee discovered that the Petroleum Products Pricing Regulatory Agency, (PPPRA), verified N429.05 billion as amount payable to the companies and sent to the federal ministry of finance, which sought the approval of the Federal Executive Council (FEC), and the Presidential Initiative on Continuous Audit (PICA), for further verification.
According to him, further verification would be required to ascertain the discrepancies between the Oil Marketing Companies (OMCs) and the recommendations for payment by the federal ministry of finance.
He said the committee was of the belief that interim payments should be made to the companies, pending the full verification of PICA recommendations and updating of interest accrual since June 30, 2017.
Senator Marafa emphasised that the services of the oil marketers were crucial to the country’s economic development and closely tied to the national security.
“So, paying the marketers would stem the threat of fuel scarcity, increase economic activities and promote a harmonious working relationship between government and the oil marketing companies,” he added.
The Senate had on May 31, revisited the request of President Buhari for the establishment of a promisory note programme and a bond issuance to settle inherited local debts and contractual obligations.
It then referred the proposal to the Senator Marafa-led Committee on Downstream Petroleum Sector, which yesterday submitted an interim report to the Senate at plenary.