The Department of Petroleum Resources (DPR) has alleged that some marketers divert petroleum products importation loans granted hem by banks into other questionable businesses, thereby hampering government’s efforts at encouraging mass importation of petroleum products by marketers.
The habit, according to DPR contributes largely to explanation to the lack of adequate participation by some marketers in the importation of petroleum products into the country.
Investigations had revealed that many banks have reduced the level of loans granted for importation of petroleum products because of independent marketers the habit of diverting loans.
A cross section of stakeholders in the downstream sector who spoke to our correspondent last week confirmed that independent marketing companies especially those owned by sole proprietors are unable to continue to sustain importation because of inability to manage available funds.
They argued that this is the more reason why the proposed deregulation of the downstream sector is important for the survival of industry.
Confirming the allegations however, the Director of the Department of Petroleum Resources (DPR) Mr. Billy Agha in a chat with Shipping Position Weekly added that even after the renewal of the licenses, majority of the marketers are still unable to do importation because of their inability to keep to the loan agreement terms with the banks, saying that this is why there are few of them engaging in importation today and that is why the NNPC still dominate importation.
He advised that in other to combat scarcity, marketers need to use funds judiciously and also solve their owing problems. Agha however expressed optimism about the level of supply saying that “it was due to the fact that some of the independent marketers are owing that made the banks to stop granting the loans”.
According to him, majority of them don’t pay on time, but with the way it is now, I think they are beginning to grant them loan facilities again plus the subsidies are being paid so as a result I know they are beginning to join in importation again”.
“For the supply of product to be stable, both the NNPC and the marketers need to collaborate and work together, while NNPC handles 50 per cent of importation, the independent marketers’ needs to take on the remaining 50 per cent, he suggested.”
He gave the identities of some of the marketers who are currently on the fore fronts of the importation as: Folawiyo Energy limited, Northwest oil and gas, MRS and a host of others.
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