Oil marketers have implored the Federal Government to urgently liberalize the downstream subsector of the oil and gas sector to attract the desired investment and curb leakages arising from fuel subsidy regime.
They appealed to government to have a re-think on the measure to deregulate and liberalize the downstream to pave way for investments from the private sector
As private marketers continue to stay on the sidelines in terms of petroleum products importation, stakeholders have reiterated the need for the Federal Government to fully deregulate the fuel market.
The marketers, under the aegis of Major Oil Marketers Association of Nigeria ( MOMAN); Independent Petroleum Marketers Association of Nigeria, IPMAN, and Depot and Petroleum Products Marketers Association, DAPPMA, who made the call in Lagos said the measure will engender unfettered private sector participation and investment, which has been hampered by absence of appropriate regulatory framework.
Speaking on the issue Chief Executive Officer/Executive Secretary, MOMAN, Mr Clement Isong, said the downstream petroleum industry regulations should be in line with international best practice.
Also speaking, the Executive Secretary, Depot and Petroleum Products Marketers Association of Nigeria, (DAPPMAN), Mr Olufemi Adewole, said that rise in the landing cost of petroleum products has renewed the calls for the full deregulation of the downstream subsector of the nation's oil and gas industry.
Adewole said banks have been mandated by CBN to freeze the interests on loans given to marketers to import fuel into the country, adding that marketers would have some money for operation should the banks comply with the directive of the apex bank.
He said marketers are in limbo following their inability to raise funds for operation, adding that the stoppage of interests on their loans is bound to bring growth.
Adewole said: “Banks are supposed to freeze the interests on facility used for fuel importation in line with the CBN’s directive. They are supposed to net-off interests on oil subsidy loans. Every interest on debt incurred by marketers, as a result of importation of Petrol Premium Spirit (PMS), as from July 4, 2018 till date, is expected to be net-off by banks.
“If some of the debts owed by marketers in the course of bringing fuel into the country are written off by banks, the better for marketers and the industry. That is why the issue of writing off the debts of the marketers is vital to the operation of the marketers and the industry.
Banks, Adewole said, are not helping matter on the issue of payment of the subsidy arrears N237billion owed marketers by the Federal Government. This, he said, was evident by the ways and manners in which banks are handling the issue of payment of the subsidy arrears.
“While some banks have acted on the promissory notes submitted to them by marketers, others are not. Often times, some banks are saying that they have not gotten ‘Policy Document’, which would enable them to start processing the promissory notes. This implies that a longer period of time would be spent by banks on the issue of processing the promissory notes. This means marketers would not get the subsidy arrears in time,” he said.
Also, the National President of the Independent Petroleum Marketers Association of Nigeria (IPMAN), Mr Chinedu Okoronkwo said total deregulation of the downstream sector would also attract more investment, generate more jobs and reduce the pressure on foreign reserves.