Independent Petroleum Products Importers (IPPIs) yesterday raised the alarm over their $1billion indebtedness to banks as a result of the Federal Government’s failure to pay them for fuel imported into the country.
The oil marketers include members of Major Oil Marketers of Nigeria (MOMAN), Independent Petroleum Marketers Association of Nigeria (IPMAN) and Depot and Petroleum Products Marketers Association (DAPPMA).
A N160billion interest has accrued on this debt, the marketers said.
A communiqué in Lagos by their legal adviser, Patrick Etim, said the inability to pay or service the loans had stalled further importation and “is threatening the operation of the affected banks and the nation’s financial industry”.
Many of their members, the communiqué said, have begun to close shop due to the debt.
The government’s debt, according to the communique, arose from Petrol Subsidy Scheme, which saw the Federal Government entering into a contract with IPPIs to import and supply petrol to the market on the condition that it would refund the difference between the landing cost and the selling price of petrol.
The government approved the landing cost, which fluctuated as it depended mainly on the international price of petrol and exchange rate of naira/dollar.
“A key term of the government’s contract with IPPIs is that the subsidy payments shall be paid to IPPIs within 45days of discharge of petrol cargo. It was also agreed that after 45 days the government shall pay the interest charges on the loans taken by the IPPIs to finance the importation of cargoes of petrol. The outstanding interest payments owed to IPPIs is currently over N160 billion,” it added.