Fuel Scarcity Worsens
NNPC Fails to meet Demands
NACCIMA calls govt, stakeholders to find solution
Almost a month after the fuel scarcity threw the country into an energy crisis, indications emerged yesterday that the situation may worsen. Prices at the pumps spiked to over N300 per liter at some filling stations, especially among those operated by independent marketers.
While the Nigerian National Petroleum Company Limited said in Abuja that an additional 2.3 billion liters of premium motor spirit will be imported in order to complement the existing one billion liters as a measure to address fuel scarcity, The Guardian reported yesterday that most marketers, especially depot owners who had paid for products since December last year, have not received the goods.
While the queues appeared to have abated last week, the situation became worse from Friday, as many petrol stations remained shut, while those that opened and sold at the official price, had long queues of motorists waiting to buy the product.
In Lagos, most of the stations owned by independent marketers that were without queues sold the product for between N200 and N250 a litre.
Amid the disruption in the distribution system, consumers are worried about the fuel scarcity and silence on the part of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) in checking the excesses of some of the marketers that had products but selling above the pump price.
Multiple sources across the value chain equally confirmed, yesterday, that the existing strategy being deployed by the state oil firm in an attempt to enable it to recover cost after being transformed into a limited liability company may further worsen the prevailing situation.
Although the NNPC was expected to truck out products to most stations in the city centres owned by the Major Oil Marketers Association of Nigeria (MOMAN). Most depot owners instead of supplying the Independent Petroleum Marketers Association of Nigeria (IPMAN) now prefer selling the products at their stations in a bid to recover losses from bank loans and new challenges that include, payment for products in dollars, which they claimed they have to source at the black market.
A source, who is a top member of Depot and Petroleum Marketers Association of Nigeria (DAPMAN), who pleaded anonymity, said though the national oil company was trying its best to address the situation, realities are far from claims being made in the media.
Recall that a new N500,000 Ship-to-Ship Coordination Charge for each transhipment operation for petrol has reportedly been introduced by NNPC, the source said most of the depot owners now have to pay for their goods in dollars and have borrowed money since December to pay for products but are yet to load products three months after.
A memo from NNPC Limited with Ref. NNPC/ML/STS01, dated February 18, 2022, and addressed to all marketers with the heading, “Payment Of STS Coordination Charge” signed by O.I O Ajilo on behalf of GGM Shipping, reads, “Please be informed that the NNPC Management has directed that effective 10th February 2022, the sum of Five Hundred Thousand Naira, (N500,000.00)
According to reports while the marketers, including NNPC Limited, agreed to blend existing dirty fuel in the country, which was observed around January 11 this year, the depots appear to have enough products to effectively blend the dirty products.
“Most depot owners that have paid for products since December have not loaded. Usually, we have only 30 days to pay back loans to the bank; we now have to pay interest of above 60 days extra. Who will bear this cost? They are telling us to bear the cost and not increase the cost of the products. Aside from that, we were paying in naira for the NNPC vessels we have been using, when we pay, they load the products and send them to our depots; now we pay in dollars. That dollar is sourced at the black market. Who pays the difference between the official and the black market rates? In addition to that, we now incur costs for a ship-to-ship charge,” he said.
He challenged the NNPC to supply products across its depot to enable IPMAN members to get products and sell at the pump price of N165.
In most parts of the country, including the Federal Capital Territory, black marketers are selling a litre for N400, just as long queues persist as most spend relatively five hours to get products due to fuel scarcity.
While Nigeria is hosting global leaders in the oil and gas sector in Abuja from today, a look through most windows at the NNPC Tower, even from the Petroleum Minister’s waiting room shows the horrific queues at the Conoil and Total stations located in front of the towers.
For over a month now, it has taken the interventions of the Police and Army to ensure sanity on the roads as the dual road that links the Wuse area of the FCT to the Central Business District through the NNPC tower is now one way due to petrol queues.
Only a few fuel stations were dispensing both in the city center and the suburbs. The few that were dispensed at the actual pump price had very long queues.
While the price was selling for N165 per litre in the city, most stations on the way towards the other parts of the northern region were selling above N300 per litre.
On the Kubwa expressway and some parts of the city, especially Jabi, Wuyi, Wuse, Central Business District, Garki and others, few fillings were dispensing under heavy queues.
On the airport road, Shema filling was without fuel. NIPCO was dispensing under a long queue. Dan oil was under lock. Oando was dispensing on the Kubwa expressway with long queues as well as MRS. Most of the A.Y Shafa stations along the route had no fuel.
Although the Vice President of IPMAN, Abubakar Shettima, did not immediately respond to the request of The Guardian, yesterday, sources at the association told The Guardian that most members could not sustain the N165 pump price, insisting that it is now difficult to get products.
Recall that the Bayelsa State government had directed all fuel stations in the state not to sell petrol above N230 per litre although the national price is N165 per litre. In Benin, Conoil along the airport road was dispensing at N200 yesterday, while the NNPC along Sapele road near Protea Hotel had long queues but was dispensing at the actual price.
In Lokoja, the price remained high and even worse across small cities in the state. For instance, Olobo Global Oil, along the old Egume road in Anyigba under Dekina local government was selling at N230 per litre.
Decrying the situation, Managing Partner, The Chancery Associates, Emeka Okwuosa, said it remained unfortunate that the queues persist.
According to him, the development remained an indication that the country lacked proactive and competent regulators in the oil and gas industry.
“NNPC is really lagging behind in its jobs. Because of a couple of odd toxic supplies in the system, we are back to queues. NNPC needs to adopt a more robust approach. I am shocked that up to date people that imported the toxic supplies have not been sanctioned.
“We must sanction them to act as a deterrent and ensure it does not happen again. What this also shows is that we don’t have emergency supplies in storage to take care of situations like this,” he said.
Okwuosa noted that the Federal Government is more interested in paying humongous subsidies than in ensuring supplies of our fuel needs.
The Nigerian Association of Chambers of Commerce Industries Mine and Agriculture (NACCIMA), at the weekend, called on the Federal Government and other stakeholders to find a definitive resolution to the lingering fuel scarcity.
NACCIMA urged the Federal Government to stop the importation of petroleum products and take immediate steps at ensuring that all refineries are working in full capacity for a definitive end to the importation of petroleum products.