April 21, 2024

 IPMAN urges Nigerians to demand transparency over how statutory allocation is shared amongst tiers of government

Ad Electricity customers must insist on tariff downgrade from DisCos for insufficient supply hours- NERCd a subheading - 1

Oredola Adeola


The Independent Petroleum Marketers Association of Nigeria (IPMAN) has charged Nigerians to hold the three tiers of government accountable over the N907 billion shared from the Federation Account Allocation Committee, which includes the payment of N123 billion as interim dividend and PSC profit oil received by the Nigerian National Petroleum Company Limited after the removal of petrol subsidy.



Mr Mike Osatuyi, IPMAN’s National Operations Controller, gave the advice on Sunday while commenting on the topic, “The aftermath of fuel subsidy removal ” when he was featured on TVC in Lagos on Sunday and monitored by EnergyDay.



EnergyDay gathered that the charged by the IPMAN official was coming on the sideline of the disclosure by Dr. Oluwatoyin Madein, Accountant General of the Federation, during the FAAC distribution that the NNPCL remitted N123bn into the coffers of government.



A breakdown of which showed that the Company paid N81bn as monthly interim dividend and N42bn as 40 per cent PSC profit oil, plus its compliance to remittance of royalties and taxes, which was the first post-petrol subsidy removal.



Osatuyi said the Nigerian Government has revealed that about N2trillion will be shared by the three tiers of government at the end of July which according to him will be the first in history.  This according to him, is three-times of what it used to be and it to be earned from savings from subsidy payment and forex unification.



He said, “In the next three and four months when all the loopholes are going to be blocked. The FAAC can go as far as sharing N3trillion among the three tiers of governments.



“The issues are then how to be accountable with the increase to cushion the effect of the petrol subsidy removal.



“If we have N600bn to be shared among the states, Ekiti state for instance, that used to have about N4bn, would be receiving about N6bn, such money should then be used to do so many radical infrastructures. I belief the benefit will be show, if the money is used judiciously.



“If we are suffering by paying so much for petrol, the government should also do their duties by spending the money transparently and accountable on the citizens. This would enable Nigerians to renew their confidence in the government.



“The Government has unified forex market and removed the arbitrage on the downstream sector, all of these revenue leakages that has been blocked will now go to the federal government purse.



“It is time Nigerians begin to demand more accountability from government; both at the state and local government levels.



He said that NNPCL’s contribution to the FAAC which could have been wasted on petrol subsidy in a month, has now gone into the coffers of the government to improve living conditions of the citizens.



He noted that the Federal Government, 36 states, and 774 local governments in Nigeria will be sharing a total of N2 trillion in statutory allocation starting from July. This allocation according to him will continue in subsequent months.



Osatuyi  urged Nigerians to demand accountability and ensure that funds are used to provide infrastructure and other important needs for citizens.

He noted that the downstream industry has been deregulated and is now determined by market fundamentals such as the landing cost, cost of crude oil per barrel, and exchange rates used for importation.

“If the price of crude oil at the international market comes down, the pump price will come down, but if it goes up, the price will go up.

Osatuyi suggested that if more petrol is imported into the country, it would drive down the price due to competition, efficiency, and better service to customers.


He also mentioned that Compressed Natural Gas (CNG) is a great alternative to petrol, but the conversion of vehicles to CNG is an issue.

 Osatuyi urged the Federal Government to focus on vehicle conversion, adding that it costs between N400,000 and N500,000 to convert a vehicle.


He suggested that the government could subsidize vehicle conversion to CNG because it is cleaner and cheaper.


Osatuyi also spoke about the benefits of Dangote Refinery, which he said would save the country billions of forex and create opportunities for young people.


He noted that when a marketer imports petrol, they pay various charges and levies, but with Dangote Refinery, some of these levies will go off and cut off drastically than those imported.


Osatuyi emphasized that Nigeria should encourage local refining because the country imports virtually everything and pays in dollars, which makes things expensive.