Finance, Dr. Ngozi Okonjo-Iweala; General Manager,
Operations, Petroleum Products Pricing Regulatory Agency
(PPPRA), Mr. Victor Shidok; and Group Managing Director
(GMD), Nigerian National Petroleum Corporation (NNPC), Mr.
Joseph Dawah, during the public hearing and signing of
agreement with relevant stakeholders in the oil sector to end
the fuel shortage or have their licences revoked, in Abuja
Energy crisis hits banks, opening hours shortened
Lagosians protest fuel shortage, perpetual blackout
Ejiofor Alike, Obinna Chime in Lagos, Omololu Ogunmade,
James Emejo in Abuja and John Shiklam in Kaduna
Nigerians will experience relief as Major Oil Marketers
Association of Nigeria (MOMAN) monday resumed loading
of petrol to various parts of the country, exactly after one
week after suspending activities in protest over unpaid
subsidy claims.
The Petroleum Tanker Drivers (PTD) section of the Nigerian
Union of Petroleum and Natural Gas workers (NUPENG),
which also withdrew tankers from the roads on May 18 in
solidarity with the marketers have also resumed trucking of
products to fuel stations nationwide.
It is expected that the independent marketers and other
depot owners would follow suit.
The decision to resume loading by oil marketers followed a
meeting convened monday by the Senate Committee on
Petroleum (Upstream and Downstream) to resolve the fuel
crisis, which had crippled economic activities nationwide
and forced several banks yesterday to reduce their opening
hours to the general public.
Although THISDAY could not reach the Chairman of
MOMAN, Mr. Obafemi Olawore, one of the marketers
confirmed that Oando, Conoil, Forte Oil, MRS, Total and
Mobil Oil agreed to commence loading at their various
depots.
“The strike was suspended because negotiations, which
started in the morning, yielded fruit. We are making
progress in the talks with government. So PTD has passed
instruction to the drivers to resume loading,” he said.
The Western Zonal Chairman of NUPENG, Mr. Tokunbo
Korodo did not pick his mobile phone when contacted, but
investigations revealed that lifting of products by the drivers
actually commenced around 3 pm at some of the depots.
Before the marketers shelved their action, Capital Oil and
Gas Industries Limited had defied the strike and
commenced the distribution of 13 million litres of petrol on
Sunday.
Chief Executive Officer of the company, Mr. Ifeanyi Ubah
had appealed to the marketers to suspend the action and
negotiate with government.
Ubah said he could not understand why the marketers
embarked on the action since the Pipeline Products and
Marketing Company (PPMC) has enough stock for
distribution to Nigerians.
“I don’t understand why we should not be loading the
products. I don’t think that at this point, our company
should be part of any sabotage against the incoming
government. That is why we are here to address the drivers
and commence loading immediately.
“I don’t believe that we should hold government to ransom.
I strongly believe that dialogue should prevail; while we
continue to give services to Nigerians, we should continue
to negotiate. But to cage government is what I don’t think is
very correct,” he explained.
Following the commencement of loading by Capital Oil,
there was a very long queue of vehicles at the company’s
filling station on the Lagos - Ibadan Expressway monday.
THISDAY gathered that vehicles started queuing as early as
2am in the morning, stretching as far back as the tollgate,
resulting in a massive traffic gridlock on the expressway.
However, men of the Federal Road Safety Commission
(FRSC) and Lagos State Traffic Management Authority
(LASTMA) were on hand to control the traffic.
The strike was called off after the Senate yesterday
brokered a truce between the federal government and the oil
marketers, after which the latter resolved to resume the
lifting of petroleum products six hours after a deal was
brokered.
Oil marketers also resolved to lift petroleum products for 24
hours everyday for two weeks with a view to addressing the
scarcity, which had crippled the nation's economic activities
for over a month.
The resolution was reached during a public hearing
organised by the Joint Senate Committee on Downstream
and Upstream Petroleum in the National Assembly where
the federal government was represented by the
Coordinating Minister for the Economy and Minister of
Finance, Dr. Ngozi Okonjo-Iweala, while Olawore,
represented the marketers.
Also involved in the agreement were the Chairman of
National Association of Road Transport Workers (NARTO),
Kassim Bataiya; the Chairman of Independent Petroleum
Marketers Association of Nigeria (IPMAN), Chinedu
Okoronkwo; and his counterpart in Depot and Petroleum
Products Marketers Association of Nigeria (DAPPMAN),
Olufemi Adewole.
The agreement was reached at a closed-door meeting
called by the Chairman of the Joint Committee, Senator
Magnus Abe, after a stalemate occurred at a the public
hearing when the oil marketers as well as Okonjo-Iweala
failed to shift grounds on the reasons for face-off between
the federal government and the marketers.
At the commencement of the hearing monday, Okonjo-
Iweala had accused MOMAN of sabotage as she disclosed
how the marketers reneged on an agreement it reached
with the federal government to end the fuel scarcity after
being paid N154 billion.
Okonjo-Iweala had told the gathering that after the
marketers were paid N154 billion, they still insisted on the
payment of another N200 billion out of which she said N159
billion would be for foreign exchange differentials.
Recalling that considerable fraud was discovered in the
subsidy scheme in 2011 when, according to her, only N252
billion was authenticated out of the N1.2 trillion subsidy
paid during the time, Okonjo-Iweala said she had declined
to sign the cheque of N159 billion demanded by the
marketers to avoid being accused of signing unverified
claims after leaving office.
According to her, the disagreement resulted in a resolution
between the government and the marketers to set up a
committee for verification of the claims with the resolve that
fuel supply would be made available while the committee
was handling the assignment.
She, however, said she was shocked when 24 hours later,
MOMAN reneged on the agreement by failing to make fuel
available to the generality of Nigerians.
The minister further revealed that when the marketers were
owed over a trillion naira, they did not shutdown the
economy, neither did they stop fuel supply for once and
wondered why they now chose to cripple the economy over
the claim of N200 billion if it wasn't an act of sabotage.
The minister further explained that the marketers shutdown
the country because they wanted all arrears they were owed
by the government to be cleared before the end of this
administration, a situation she said was wrong because
government was a continuum.
Affirming her allegation of sabotage, Okonjo-Iweala asked
why the marketers refused to supply diesel when it was
common knowledge that no subsidy was meant to be paid
for diesel having been deregulated by the government of
President Olusegun Obasanjo over 10 years ago.
But Olawore, debunked the minister's claim, saying they
had failed to import fuel because only N32.5 billion of the
N154 billion paid to them by the government accrued to
them. He explained that the balance was deducted by
commercial banks which funded the importation before they
could access the money in the banks.
He also claimed that no supply was made because the
banks refused to finance further importation of fuel, adding
that despite the intervention of the Governor of Central Bank
of Nigeria (CBN), Mr. Godwin Emefiele, the banks had
refused to budge.
He also claimed that the tanker drivers were instrumental to
the fuel crisis because they failed to lift fuel from depots.
He also claimed that both petrol and diesel are lifted by
drivers whom he said had stopped lifting.
He also said failure of the government to make verification
an ongoing exercise contributed to the crisis.
Earlier, the Group Managing Director of Nigeria National
Petroleum Corporation (NNPC), Mr. Joseph Dawha, had
disclosed that NNPC had in storage no fewer than 981
million litres of petrol which he said could last for 24 days.
He said the situation became critical following the strike
embarked upon by the NNPC chapter of NUPENG and
Petroleum and Natural Gas Senior Staff Association of
Nigeria (PENGASSAN).
At the end of the brief closed-door meeting, Abe said
information reaching them at the time showed that
NUPENG and PENGASSAN had called off their strike.
Abe also announced that Okonjo-Iweala and MOMAN had
reached an undertaking on how the matter would be
resolved, a move he said led to a resolution that lifting of
products would begin in the next six hours.
He said: “I'm glad to announce to all of us that we have
been able to reach some understanding that we believe will
bring immediate solution to the problems in the supply and
distribution of products nationwide.
“I also want to thank the GMD of NNPC for his determined
intervention with the unions within NNPC that also resulted
in a solution to the problems of the strike in the corporation
just in the course of our meeting right now.
“So as we speak now, we have clear information that
NUPENG and PENGASSAN strike in NNPC has been called
off following the intervention of the GMD.
“So we have agreed on the following: The Minister of
Finance will give an undertaking to the major marketers and
PPPRA that the work on that committee being headed by
the CBN would be concluded in verifying the outstanding
claims.
“If it is concluded before the end of the life of this
administration, it will be reflected in the handover note. If it
is not concluded before the end of the life of this
administration, then the fact that such a committee is set
up and working will be reflected in the handover notes and a
copy of the letter conveying the existence of this committee
will be sent to MOMAN and DAPPMA and also to this
committee.
“So on the basis of that agreement, MOMAN will offer
whatever cooperation that is needed to enable lifting of
products nationwide to begin within the next six hours.
“We have also agreed that NNPC is to direct all relevant
staff at all depots to work 24 hours including Saturdays and
Sundays for the next two weeks until normalcy returns to
the sector.
“We have also agreed to reach out to the Lagos State
Government to facilitate this agreement and reach some
kind of arrangement with the tanker drivers that will allow
access to the relevant depots to enable the lifting of
products to commence,” Abe submitted.
Earlier, NARTO had told the committee that MOMAN was
owed it N20 billion while the Petroleum Products Pricing
and Regulatory Authority (PPRRA), disclosed that it had 425
million litres of petrol in Lagos; 102 million in Port Harcourt;
66 million in Warri; and 48 million in Calabar.
The agency also said working for 24 hours non-stop for two
weeks as agreed at the meeting was not feasible because
security and safety of persons to do the lifting for 24 hours
could not be guaranteed.
Banks Shorten Opening Hours
But before NUPENG and major marketers announced the
resumption of lifting and distribution of petroleum products,
most banks in the country yesterday notified their
customers of their intention to reduce their opening hours
owing to unavailability of petroleum products.
The banks in separate notifications to their customers
explained that the current shortage of petroleum products in
the country had limited their ability to supply diesel to all
their branches, in order to continue normal branch
operations.
The significant drop in the country’s epileptic power supply
was also having dire consequences on the operations of the
financial institutions.
Findings showed that while First City Monument Bank
Limited (FCMB), Guaranty Trust Bank Plc (GTBank) and
Skye Bank Plc closed their branches at 1pm yesterday,
Union Bank Plc, Keystone Bank Limited and Fidelity Bank
Plc closed theirs at 2pm.
However, the banks advised their customers to use their
respective alternative banking channels.
Specifically, FCMB in a text message to its customers
explained: “Dear Customers, our branches will close at 1
pm from Monday, May 25, due to shortage of petroleum
products. All our alternate channels will remain available.”
Similarly, GTBank, in a notice of early closure of its
branches to its customers, stated: “The current shortage of
petroleum products in the country has limited our ability to
supply diesel to all our branches, in order to continue
normal branch operations.
“Due to this, we unavoidably have to close our branches
nationwide at 1pm, from tomorrow Monday, 25th May
2015.
“Whilst we have had to take this step to close branch
operations early, we would like to seek your understanding
at this time, and assure you that we will continue to work
hard at finding alternative solutions to this situation and will
advise you once the situation has abated.
“However, all our alternative channels will be fully
functional and available for all your personal and business
banking.”
In the same vein, Union Bank, which also gave similar
reasons for the closure of its branches nationwide at 2pm,
also disclosed that it relies heavily on diesel generators to
run its operations.
Owing to the shortening of opening hours, in Kaduna State,
many customers who trooped to the banks at about 1.30
pm yesterday to the banks were greeted with notices which
were conspicuously pasted at their gates.
When the Kano Road branches of GTBank, Diamond Bank
Plc and Keystone Limited were visited, a large crowd had
gathered around their premises. Bank customers were
taken aback by the sudden decision of the banks to reduce
their operating hours.
Similarly, virtually all the commercial banks in the Federal
Capital Territory (FCT) yesterday closed business at about
1pm due to the energy crisis in the country.
The limited service delivery is expected to continue until the
fuel situation improves.
However, many bank customers in Abuja expressed
dissatisfaction with the new closing time describing it as
too early.
GTBank, First Bank of Nigeria Limited (FirstBank), Diamond
Bank and Access Bank Plc, among others, all had pasted
notices to customers to this effect.
However, some commercial banks visited by THISDAY in
Abuja were a bit relaxed, being the first day of the notice
and agreed to extended services beyond 1 pm.
Lagosians Protest Fuel Shortage, Perpetual Blackout
Another fallout of the energy crisis yesterday was the
protest by Lagos residents who were fed up with the
situation.
The peaceful protest which was held at the Agidingbi area
of Ikeja, saw men and women chanting slogans expressing
their grouse against the epileptic power situation and the
lingering fuel scarcity.
With placards that read, ‘Enough of Blackouts’, ‘Enough is
Enough’, ‘We Did Not Bargain for Suffering’, the protesters
marched through Agidingbi area to register their
grievances.
The President of the Lagos Chamber of Commerce and
Industry (LCCI), Mr. Remi Bello, who noted with concern the
unprecedented energy crisis facing the country, stressed
the need for the situation to be fixed urgently.
LCCI also urged the incoming administration to immediately
deregulate the oil and gas downstream sector (on
assumption of office), in order to provide an enduring
solution to the recurring problem of petroleum product
scarcity, corruption inherent in the subsidy regime, the
collapse of refineries, lack of investment in the downstream
sector, loss of jobs and so on.
Taleveras Clarifies SAA with NPDC
Meanwhile, a local oil and gas operator, Taleveras, has
provided clarification on the Strategic Alliance Agreement
(SAA) entered into by the Nigerian Petroleum Development
Company (NPDC), the exploration and production subsidiary
of the Nigerian National Petroleum Corporation (NNPC), for
Oil Mining Lease (OML) 19.
In a statement provided yesterday by Taleveras, the
company said NDPC signed an SAA with Petrofac on OML
119, while Taleveras is the local content partner to
Petrofac. It stated that Taleveras has no direct connection
or business activity with NPDC under any SAA.
It further said not one drop of oil has been lifted under this
Petrofac/Taleveras SAA contract with NPDC, adding that
the records are there to show that Agip ENI are still the
main contractors of the current SAA and it is only when it
expires the Petrofac/Taleveras SAA will kick in.
It revealed that the Agip SAA would expire around 2020,
once certain production milestones have been met, adding
that Petrofac/Talevera is expected to invest enormous
capital in drilling new wells around the production area
before the expiration of AGIP’s current SAA, but this has not
yet commenced.
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