FG fulfills Pledge; Pays more Subsidy Claims

In fulfillment of its pledge to ensure speedy payment of outstanding subsidy claims to oil marketing and trading companies, the Federal Ministry of Finance has paid more marketers. It was however gathered that the payment process was being hampered by tight liquidity as the Central Bank of Nigeria (CBN) was not able to redeem all the Sovereign Debt Notes (SDNs) issued to the marketers.

Under the subsidy regime, the Petroleum Products Pricing Regulatory Agency (PPPRA) issues Sovereign Debt Statements (SNS) to marketers, who forward them to the Debt Management Office to obtain SDN, which they use to make subsidy claims at the CBN.

The decision to pay the marketers was reached at a meeting held in Abuja by the Minister of Finance and Coordinating Minister for the Economy, Dr. Ngozi Okonjo-Iweala, and a group of marketers.

The federal ministry of finance withheld payment of 25 marketers, which the Aig-Imoukhuede Committee had recommended that they should refund various amounts of money to the federal government. However, the claims of marketers that will refund money to the government will be netted out against their entitlements, while marketers with negative balance will refund money to the government.

The ministry had also stated that between April and May 2012, the 14 marketers under batches D/12 and E/12 were paid N17billion claims. It also paid additional N25.6billion worth of claims to the marketers, since the beginning of July 2012, bringing the total claims paid to 31 oil marketers between April and August 2012 to N42.666billion.