NNPC Begins N15bn Refund to Oil Marketers Following DSS Mediation, IPMAN Confirms

Oil marketers on Sunday, confirmed that the Nigerian National Petroleum Company Limited (NNPC) had started refunding the N15 billion owed its members by the national oil company.

Before the current developments in the downstream sector, the oil sector players under the Independent Petroleum Marketers Association of Nigeria (IPMAN), said that they had paid the money to the NNPC for supply of petrol.

However, members of the association said that they were neither supplied nor reimbursed the funds, but that instead the NNPC was asking its members to augment the payment that was made months ago.

“It is unacceptable for the NNPC to ask us to add more money after withholding our payments for months without supplying the product,” Maigandi Shettima, head of the group had lamented during a television interview.

“Roughly, the amount we have paid is almost N15 billion. Our money has been with the NNPC for nearly three months, and they have yet to provide the product we paid for. Now, they are asking us to pay the difference,” Shettima added.

But speaking on the issue in an interview on Sunday, IPMAN spokesman, Chief Chinedu Ukadike,  said that the NNPC had started refunding the monies to the marketers’ wallets with the oil company after the Department of State Service (DSS) brokered a peace deal.

“We went to a meeting with the Director of the DSS who intervened in our matter,” Ukadike stated.

According to him, another outcome of the meeting was that the regulator, the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) had agreed to issue the marketers licence to off-take from Dangote directly .

In addition, since Nigeria now operates a deregulated downstream market, the oil marketers, he said, have also been given the go-ahead to import petrol, given that the prospective firms have the required capacity.

Besides, at the meeting, he said, the NMDPRA agreed to pay the independent marketers N10 billion owed to them from the petrol bridging debt under the Petroleum Equalisation Fund (PEF) owed them.

“NMDPRA has graciously approved the sum of N10 billion for IPMAN’s outstanding payments in PEF. NNPC has also agreed to reduce the rate it sells to us from N1,040 per litre to about N1,000. They have also agreed to return our outstanding money we paid to them through their portal so that marketers can make it up.

“These are the things that we agreed on and we are awaiting implementation. But as I am talking to you now, NNPC has returned our money to individual independent marketer’s wallets,” he pointed out.

Ukadike noted that although the actual price the marketers will buy from the new $20 billion Dangote refinery had not been fully concluded, they will soon schedule a meeting with officials of the facility to arrive at a pricing template and loading arrangement.

There had been some sort of uncertainty in the downstream oil sector for weeks following the earlier pronouncement by the federal government that the NNPC will be the sole off-taker for petrol produced by the Dangote 650,000 barrels per day refinery.

But the Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, last Friday explained that the direct purchase mechanism will henceforth allow marketers to negotiate commercial terms directly with the refineries, thereby fostering a more competitive market environment and enabling a smoother supply chain.

Edun, who is the Chairman of the Implementation Committee on Domestic Sales of Crude Oil in Local Currency, said the “New Direct Purchase Model,”  was the most significant change under the new regime which now allows petroleum product marketers to purchase petrol directly from local refineries.

“This direct purchasing mechanism allows marketers to negotiate commercial terms directly with the refineries, fostering a more competitive market environment and enabling a smoother supply chain for petroleum products,” he stated.

Emmanuel Addeh

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