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Jonathan orders subsidy payments to marketers to end fuel scarcity …queues to disappear this week, says NNPC



President Goodluck Jonathan has directed the Finance Minister, Dr.  Ngozi Okonjo-Iweala to pay all outstanding debts to petroleum products marketers in a bid to end the fuel crisis.   Consequently, the Federal Ministry of Finance has directed the Debt Management Office (DMO) to raise a special Sovereign Debt Note (SDN) of N100 billion to offset the claims.   

The Coordinating Minister for the Economy and Minister of Finance, Dr. Ngozi Okonjo-Iweala, who revealed the move to pay the outstanding subsidy claims in Abuja yesterday said the debt management agency has already raised the sum.   The development has indeed thrown up the country’s real liquidity situation as she grapples to meet contingent commitments like workers’ salaries and contractual obligations owing to the sharp drop in crude oil prices at the international market.  

To assuage the oil marketers, the Finance Minister declared that the Federal Government has concluded arrangement with the banks to bear the interest that has built on their loans as well as pay the differential in exchange rate caused by the drastic loss in the value of the naira in the face of the recent devaluation undertaken by the Central Bank of Nigeria (CBN).   The minister yesterday explained that the government was undertaking the initiatives because it was worried by the fuel scarcity and wanted it permanently resolved.

Her words :”Government is very concerned about the fuel queues which have appeared in Lagos, Abuja and other parts of the country. As Nigerians can attest, the Petroleum Ministry and the Nigerian National Petroleum Corporation (NNPC) have worked very hard to reduce the queues to the barest minimum. We sympathise with Nigerians whose lives and business  activities are being disrupted by the queues and assure them that we are working hard to end them as quickly as possible. 

“The situation is due to a mix of factors, including disruption of pipelines, and logistical issues, and they are being attended to urgently. I want to emphasize that contrary to some unfounded speculations, the queues are not caused by payment issues. As you know, we paid the marketers a total of N320.8 billion from the Excess Crude account in two instalments in December last year. This underscores the fact that we are taking payment of marketers very seriously indeed. We’ve been in constant touch and talking with the marketers, and a week ago, we reached an agreement with them on their core concerns which we have addressed.   

“ Specifically, we have taken the following steps: • reached an agreement with the marketers’ union on the N185 billion balance of their payment;  • paying not only the costs they’ve incurred and their fees but interest and forex differentials;  • DMO has issued SDNs to cover N100 billion out of the N185 billion agreed upon as balance for the next payments; and  • CBN has given approvals for the banks to issue letters of credit.”   Okonjo- Iweala said it has become clear that while the marketers’ union and most members have been cooperative, some of their members are not.

The minister who revealed that some of these uncooperative marketers have even refused to open Letters of Credit (LCs) to facilitate their payments, saluted the union and the members who are working hard to end the unfortunate situation. She urged Nigerians to demand from the un – cooperating members what their motives are.   Again she gave more hints on actions being taking to end the fuel scarcity debacle: “ To end this unfortunate situation as quickly as possible, the Petroleum Ministry and NNPC are taking strong action to improve supplies in this election season. I’ve been speaking with MOMAN and they’ve assured me that they are working hard to increase supplies and more are on the way. About 40million litres of product are being distributed in Lagos today.

As at yesterday, 86 trucks have come into Lagos and another 86 trucks are heading to Abuja. Other parts of the country are also included in the plans. So, the situation should improve soon. Once again, we wish to express our sympathy with Nigerians for this very unsatisfactory situation and salute their patience as we work hard to end the situation as soon as possible.”  

Meanwhile, the Group Executive Director (Commercial and Investment) of NNPC, Aisha Abdulrahman, has assured that the queues will end this week She stated this in Abuja when the Supervising Minister of Information, Chief Edem Duke led a team of reporters for on-the-spot assessment of the situation in the filing stations. She said the glitch that disrupted fuel supply in the last few days had been addressed, adding that the NNPC now has adequate stock that could last between 20 and 30 days.  

Abdulrahman encouraged filing stations to complement NNPC retail outlets by selling petrol for 24 hours in order to clear the queues across the country. She discouraged speculation, panic buying and hoarding because, according to her, the NNPC is flooding the country with petroleum products.  

Duke said all the depots across the country were wet with fuel but the queues in the filing stations were a result of speculation and panic buying. He berated the opposition for cashing in on the fuel situation to score cheap political point, assuring that the President Goodluck Jonathan administration would remain responsive to the welfare and economic well-being of the citizens.  

“A good government cannot inflict scarcity on its people. It cannot bite its nose to spite its face, especially at a time when there is political tension.

There is no government worth its onions that will say rather than focus on strategies to win election, let us deprive the citizenry of adequate supply of petroleum products. So when people are sitting in Dubai and issuing statements that are unfounded, I think we as the conscience of the nation should know better,” he stated.  

Also yesterday, the Petroleum Products Pricing and Regulatory Agency (PPPRA) blamed the scarcity on the two rounds of devaluation carried out by the CBN between November last year and February 2015.  

Speaking at the on-going budget defense before the Senate Committee on Petroleum (Downstream), Executive Secretary of PPPRA, Farouk Ahmed, told the panel that the devaluation caused huge confusion in the oil sector as the petroleum agency did not know the exchange rate to be used for payment for fuel importation.

“Thus marketers could not deliver the cargoes of fuel expected from them because they were not sure of the exact delivery cost as a result of the devaluation as the old template used for paying the marketers was no longer useful,” he said.  

Ahmed, who said the PPPRA had to seek the advice of the CBN before it could eventually draw up a new template, told the lawmakers that the crisis had eventually been resolved as the Budget Office on Monday approved payment of outstanding claims the marketers. He revealed that the truce was brokered after a meeting of the Ministry of Finance, PPPRA and other relevant agencies.

“The recent events have to do with delay in the arrival of cargoes. Non-arrival of cargoes made it difficult for petrol to be delivered. What actually complicated it was the devaluation of naira – two times.  

“The first one that took place on November 28 when naira was devalued  from N155 to N168 to $1. The second one took place on February 18, 2015 that brought the exchange rate to N199 to $1. These two developments brought a lot of confusion into the oil sector.” – Guardian.


WAIVER CESSATION: Igbokwe urges NIMASA to evolve stronger collaboration with Ships owners



…Stresses the need for timely disbursement of N44.6billion CVFF***

Highly revered Nigerian Maritime Lawyer, and Senior Advocate of Nigeria (SAN), Mike Igbokwe has urged the Nigeria Maritime Administration and safety Agency (NIMASA) to partner with ship owners and relevant association in the industry to evolving a more vibrant merchant shipping and cabotage trade regime.

Igbokwe gave the counsel during his paper presentation at the just concluded two-day stakeholders’ meeting on Cabotage waiver restrictions, organized by NIMASA.

“NIMASA and shipowners should develop merchant shipping including cabotage trade. A good start is to partner with the relevant associations in this field, such as the Nigeria Indigenous Shipowners Association (NISA), Shipowners Association of Nigeria (SOAN), Oil Trade Group & Maritime Trade Group of the Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA).

“A cursory look at their vision, mission and objectives, show that they are willing to improve the maritime sector, not just for their members but for stakeholders in the maritime economy and the country”.

Adding that it is of utmost importance for NIMASA to have a through briefing and regular consultation with ships owners, in other to have insight on the challenges facing the ship owners.

“It is of utmost importance for NIMASA to have a thorough briefing and regular consultations with shipowners, to receive insight on the challenges they face, and how the Agency can assist in solving them and encouraging them to invest and participate in the maritime sector, for its development. 

“NIMASA should see them as partners in progress because, if they do not invest in buying ships and registering them in Nigeria, there would be no Nigerian-owned ships in its Register and NIMASA would be unable to discharge its main objective.

The Maritime lawyer also urged NIMASA  to disburse the Cabotage Vessel Financing Fund (CVFF)that currently stands at about N44.6 billion.

“Lest it be forgotten, what is on the lips of almost every shipowner, is the need to disburse the Cabotage Vessel Financing Fund (the CVFF’), which was established by the Coastal and Inland Shipping Act, 2003. It was established to promote the development of indigenous ship acquisition capacity, by providing financial assistance to Nigerian citizens and shipping companies wholly owned by Nigerian operating in the domestic coastal shipping, to purchase and maintain vessels and build shipping capacity. 

“Research shows that this fund has grown to about N44.6billion; and that due to its non-disbursement, financial institutions have repossessed some vessels, resulting in a 43% reduction of the number of operational indigenous shipping companies in Nigeria, in the past few years. 

“Without beating around the bush, to promote indigenous maritime development, prompt action must be taken by NIMASA to commence the disbursement of this Fund to qualified shipowners pursuant to the extant Cabotage Vessel Financing Fund (“CVFF”) Regulations.

Mike Igbokwe (SAN)

“Indeed, as part of its statutory functions, NIMASA is to enforce and administer the provisions of the Cabotage Act 2003 and develop and implement policies and programmes which will facilitate the growth of local capacity in ownership, manning and construction of ships and other maritime infrastructure. Disbursing the CVFF is one of the ways NIMASA can fulfill this mandate.

“To assist in this task, there must be collaboration between NIMASA, financial institutions, the Minister of Transportation, as contained in the CVFF Regulations that are yet to be implemented”, the legal guru highlighted further. 

He urged the agency to create the right environment for its stakeholders to build on and engender the needed capacities to fill the gaps; and ensure that steps are being taken to solve the challenges being faced by stakeholders.

“Lastly, which is the main reason why we are all here, cessation of ministerial waivers on some cabotage requirements, which I believe is worth applause in favour of NIMASA. 

“This is because it appears that the readiness to obtain/grant waivers had made some of the vessels and their owners engaged in cabotage trade, to become complacent and indifferent in quickly ensuring that they updated their capacities, so as not to require the waivers. 

“The cessation of waivers is a way of forcing the relevant stakeholders of the maritime sector, to find workable solutions within, for maritime development and fill the gaps in the local capacities in 100% Nigerian crewing, ship ownership, and ship building, that had necessitated the existence of the waivers since about 15 years ago, when the Cabotage Act came into being. 

“However, NIMASA must ensure that the right environment is provided for its stakeholders to build and possess the needed capacities to fill the gaps; and ensure that steps are being taken to solve the challenges being faced by stakeholders. Or better still, that they are solved within the next 5 years of its intention to stop granting waivers”, he further explained. 

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Breaking News: The Funeral Rites of Matriarch C. Ogbeifun is Live



The Burial Ceremony of Engr. Greg Ogbeifun’s mother is live. Watch on the website: and on Youtube: Maritimefirst Newspaper.

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Wind Farm Vessel Collision Leaves 15 Injured



…As Valles Steamship Orders 112,000 dwt Tanker from South Korea***

A wind farm supply vessel and a cargo ship collided in the Baltic Sea on Tuesday leaving 15 injured.

The Cyprus-flagged 80-meter general cargo ship Raba collided with Denmark-flagged 31-meter wind farm supply vessel World Bora near Rügen Island, about three nautical miles off the coast of Hamburg. 

Many of those injured were service engineers on the wind farm vessel, and 10 were seriously hurt. 

They were headed to Iberdrola’s 350MW Wikinger wind farm. Nine of the people on board the World Bora were employees of Siemens Gamesa, two were employees of Iberdrola and four were crew.

The cause of the incident is not yet known, and no pollution has been reported.

After the collision, the two ships were able to proceed to Rügen under their own power, and the injured were then taken to hospital. 

Lifeboat crews from the German Maritime Search and Rescue Service tended to them prior to their transport to hospital via ambulance and helicopter.

“Iberdrola wishes to thank the rescue services for their diligence and professionalism,” the company said in a statement.

In the meantime, the Hong Kong-based shipowner Valles Steamship has ordered a new 112,000 dwt crude oil tanker from South Korea’s Sumitomo Heavy Industries Marine & Engineering.

Sumitomo is to deliver the Aframax to Valles Steamship by the end of 2020, according to data provided by Asiasis.

The newbuild Aframax will join seven other Aframaxes in Valles Steamship’s fleet. Other ships operated by the company include Panamax bulkers and medium and long range product tankers.

The company’s most-recently delivered unit is the 114,426 dwt Aframax tanker Seagalaxy. The naming and delivery of the tanker took place in February 2019, at Namura Shipbuilding’s yard in Japan.

Maritime Executive with additional report from World Maritime News

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