NIPMF’s Potential Shutdown Over Outstanding N250 Billion Debt

Explore the potential shutdown in Northern Nigeria’s petroleum distribution due to NIPMF’s outstanding N250 billion debt.

A Crisis in the Making – N250 Billion in Debt

Musa Yahya Maikifi, the leader of the Northern Independent Petroleum Marketers Forum (NIPMF), has brought to light a brewing crisis in the Nigerian petroleum industry.

During a gathering in Kano state on July 27, he claimed that the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) owes the forum an alarming N250 billion.

These outstanding bridging claims accumulated over the past year could potentially trigger a catastrophic shutdown in the petroleum sector.

The Dire Consequences of Unpaid Claims

The non-payment of these bridging claims, according to Maikifi, could significantly hamper petroleum distribution in the Northern states.

The scenario is dire, as he warned that the forum members are no longer able to shoulder the transportation and distribution costs of petroleum products for sale.

Jarma Mustapha’s Plea to the President

The forum’s Secretary, Jarma Mustapha, echoed Maikifi’s concerns. He painted a gloomy picture of the situation the members find themselves in, particularly with the advent of the new deregulation regime.

Many members, he revealed, are struggling with a lack of resources and capability to continue operations due to the bulk of their capital being tied up with the defunct Petroleum Equalization Fund (PEF).

The Urgent Call for Presidential Intervention

In the wake of these challenges, Mustapha called upon President Bola Ahmed Tinubu to intervene and ensure the settlement of all outstanding claims up until May 30, 2023 – the day the new deregulation was announced.

This step, he believes, is critical for their members to secure the needed capital to stay in business.

The Skyrocketing Capital Requirements

Mustapha further elaborated on the financial hardships experienced by the members.

He pointed out that the capital needed for a single truck of product has quadrupled, making it increasingly difficult for them to maintain the same fleet size.

With most of their members on the verge of exiting the business, the situation seems dire without swift intervention.

The Potential Domino Effect

An impending shutdown of fuel distribution in the Northern states seems to be on the horizon if these concerns are not promptly addressed.

Mustapha warned that without the necessary intervention, their services might be withdrawn, leading to an unforeseen crisis.

Understanding Bridging Claims

For the uninitiated, bridging claims are funds contributed by consumers, collected by marketers, and paid to NNPCL.

NNPCL, in turn, deposits the money into the Equalization Fund’s collective pool.

Not a Government Burden

It’s worth noting that these funds do not come from government coffers but are financed by consumers through marketers.

The purpose is to maintain uniform pricing across the country.

The Diplomatic Route and Its Limitations

Although they aim to access the fund through diplomatic channels, Mustapha admitted there is no assurance of sustainability.

Controlling their members amidst the mounting difficulties could pose a significant challenge, he admitted.

The Need for Government Intervention

Mustapha urged the government to recognize the precarious situation, consider their support for deregulation policies, and take the necessary steps.

As businessmen, their members are not inclined to strike.

If the situation persists, they may need to withdraw their services.

The NIPMF’s predicament represents a larger issue in Nigeria’s petroleum industry.

Without swift intervention from the government and payment of the outstanding N250 billion debt, a full-scale shutdown seems to be an imminent threat.

It starkly reminds us of the petroleum industry’s vital role in the nation’s economy.

for more info do follow /piggybank.ng

FAQ