Cause of petrol crisis, by marketers

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Marketers yesterday gave reasons for the petrol crisis that marred the Chrismas celebrations across the country.

Also yesterday, the Independent Petroleum Marketers of Nigeria (IPMAN), said the major solution to the petrol crisis is the building of modular refineries.

It was at a meeting of all stakeholders convened at the Presidential Villa in Abuja. It was chaired by the Chief of Staff to the President, Mallam Abba Kyari.

Minister of State for Petroleum Resources Ibe Kachikwu, Nigerian National Petroleum Corporation (NNPC) Group Managing Director Maikanti Baru and marketers attended.

A committee, raised at yesterday’s meeting and chaired by the minister of state, will meet today to fine-tune the decisions.

Chairman of the Depot and Petroleum Marketers Association of Nigeria (DAPMAN) Mr. Dapo Abiodun, said the meeting was to find out what went wrong and to proffer solution.

“A lot of issues were raised and a committee was constituted that will meet tomorrow (today) under the chairmanship of the Minister of State for Petroleum to further go into the nitty gritty and to ensure that these problems do not reoccur again,” he said

He explained that the marketers at the meeting made their submissions known to government and emphasized that the scarcity was not a marketer-induced problem.

Abiodun said: “There was no hoarding on the part of any marketer. Marketers are your brothers, they are Nigerian citizens, they are businessmen, no marketer makes money from hoarding petroleum products, our business is to take petrol and sell.

“We explained that the problem that you saw is not willful on the part of anyone, either NNPC or marketers. The situation from our point of view is that from January to December, the price of crude remained relatively stable, following the hurricane Katrina in the month of September/October, crude prices went up and marketers lost the ability to import and sell at N145 per liter.

“Since the price of crude is directly proportional to refined product, we could not import petrol and sell at N145 any more. And this business is a partnership between marketers and the NNPC. Marketers bring in a certain volume and NNPC also brings in a certain volume.

“In the past, marketers bring in about 60 per cent while the NNPC brings about 35 to 40 per cent. But, by October, marketers completely stopped importing because there was no more subsidy. So, we can’t sell for profit so we had to stop importing.

“So, the burden of importing 100 percent then fell on the NNPC. So you can imagine a situation where NNPC was importing in part, and marketers were importing in part and then suddenly NNPC begins to import 100 per cent .

“Coupled with the fact that in the months we called the ‘ember months’ from October to December, the consumption of petrol is highest in the country. So, you now have what we called a double warning. NNPC is suddenly finding it difficult importing what they probably didn’t expect in terms of volume and the fact that Nigerians themselves are consuming more volume than they will normally consume in the earlier months.

“Coupled with the fact that the countries that are surrounding us as a nation are all selling fuel at more than $1 per liter. $1 today is about N360. If you go to Cotonou, Ghana, Niger, so, it is not unlikely that some of our petrol is finding itself across to these countries.

“All these are issues we believe amounted to what we saw in December. But thankfully, the NNPC rose to the occasion, they stepped up import, stepped up supplies that situation has since normalised.

“Today’s (yesterday) meeting is to ensure that this does not happen again and this we are going to continue tomorrow in the committee that was set up under the chairmanship of the minister of state for petroleum to ensure that we find a long-lasting and enduring solutions to this problem so that Nigerians will not have to go through this situation again.

Asked if the issue of subsidy was discussed at the meeting, he said “Well, like I told you, there is no subsidy at the moment. The government in its wisdom has decided that the N145 cap will remain because of what they consider will be consequences on Nigerians. This is a government of the people and they believe Nigerians should not be made to buy fuel for more than N145.

“So, if that is to remain, then we have to find other ways to manage the situation so that we will continue to sell fuel at N145. As far as we are concern, there is no subsidy in the budget, as far as we are concern, marketers cannot import and sell at N145. So, the government has to find a way and ensure that marketers themselves importing alongside NNPC and still sell at N145.

“So, when we meet with the minister tomorrow, we will find solution to see how that can be sustained.

The National President of Independent Petroleum Marketers Association of Nigeria (IPMAN), Chinedu Okoronkwo, said: “We are glad with the promise of the Chief of Staff at the meeting. With what we have heard today from the meeting, Nigerians should go home and be glad because the issues of constant fuel supply has been resolved.

“The issue apparently, by tomorrow (today) will be resolved as a committee will be set up to ensure that the Major Oil Marketers Association of Nigeria (MOMAN), the IPMAN and all those that are supposed to be bringing in the products will contribute.

“This will solve this problem once and for all. They have also assured that the refineries are coming on stream to the installed capacity. This is a cherry news,” he said.

IPMAN’s Board of Trustees Chairman Aminu Abdulkadir said: “On subsidy, I think there is a meeting that is coming up tomorrow (today) at the minister’s office. I think full disclosure will be made on plans and ways of augmenting marketers’ shortfall so that marketers can come back to business.

“Because if marketers are in the business, the NNPC will be augmented. Because what has happened today is that because the NNPC was left alone and it will not be easy for them to manage all the depots, the trucks, the stations.

“So, its a business for all. Before this time, the NNPC was doing 60 and marketers were doing 40 per cent. In fact there was a time NNPC was doing 40 and marketers 60 percent. But today, marketers is zero,” he added.

Kachikwu said: “The whole idea was to do a centric analysis of what really went wrong. Like you know, for over two years, we have been out of this petroleum, it’s been working well. The NNPC has been managing it properly, and suddenly, there was this gap.

“So, they wanted us to put heads together to find out what went wrong; it’s not a fault-finding meeting; how do we take corrective measures to avoid that and what are the things that are creating the difficulties in the system.

“Because fuel scarcity has been ever lingering. It is a 30/40-year-old thing and I think it is to the credit of Mr. President and his government over the last two years that we haven’t had any of this through his policy that he has enunciated.

“So, that was the objective of today’s meeting. Everybody gave ideas, everybody was collaboratively finding solutions,” he said

According to him, another meeting will be held with the oil marketers today in his office.

He said: “The GMD started by presenting what the scenario was. At least for now, it has taken away the fuel queues that you see. Then dig into the long term solutions and everybody contributed.

“We set up a committee which I will head, the members included, the GMD, most of the parastatals in the Ministry, DAPMAN, IPMAN, MOMAN, labour unions, and we are to meet in my office tomorrow and dig deeper into this thing and find a long term solution.

“This is a major concern that Nigerians should not be made to suffer; that Nigerians do not get through this kind of things they went through last December. We want to find lasting solution and that is what the committee will come out with in the resolutions tomorrow.

On whether the erring oil marketers will be sanctioned, he said: “The thing is, even Nigerians who have suffered will want to be sure that we find a lasting solution and find evidential basis upon which to punish people. This is a democratic government.

Asked if the government got all the evidence it needed with what Nigerians went through, he said: “I don’t have one yet. If you have one, I will like to have it.”

When reminded that the President labelled some people as blackmailers in his New Year speech, he said: “I feel your pain, we share in those pains. But, we are going to find lasting solution. They are people who are culprits they will be identified. In fact, the chief of staff instructed that specific names should be put on the table, those who have gone against the rule, done certain things that are against the book should be punished.

“But, the greatest difficulty in Nigeria is that people make allegations, when you then ask for evidence, even one, everybody now goes back into the safety nets. You cannot prosecute, except you have evidence, I’m 30 years old as a lawyer. So, we will need to find that evidence, we will definitely punish those who did things that were wrong.

“But more fundamental and more importantly is that we want to find lasting solutions and we all want to work more collaboratively.”

“We are going to sit down and find lasting solution. Let’s face it we have had this lasting solution for two years,” he stated.

Modular refineries‘ll end fuel scarcity, says IPMAN

The Independent Petroleum Marketers Association of Nigeria (IPMAN) yesterday urged the Federal Government to invest more in modular refineries as a way to end fuel scarcity.

Alhaji Debo Ahmed, the Chairman, South-west zone of IPMAN, gave the advice in an interview with the News Agency of Nigeria (NAN) in Lagos.

Vice President Yemi Osinbajo two days ago in Lagos, confirmed that 10 modular refineries were at advanced stages of development in the Niger Delta.

The 10 modular refineries are located in five out of the nine states in the Niger Delta.

The states include: Akwa Ibom, Cross River, Delta, Edo and Imo.

Osinbajo said two of the refineries, Amakpe Refinery (Akwa Ibom), and OPAC Refinery (Delta State), have had their mini-refinery modules already fabricated, assembled and containerised overseas and ready for shipment to Nigeria for installation.

The total proposed refining capacities of the 10 licensed refineries stands at 300,000 barrels.

Ahmed said the modular refineries could help address any shortfall in fuel supply, pending when additional refineries would be built.

He said: “It will also boost the country’s revenue generation and address frequent fuel capacity experienced during the Yuletide seasons.

“Our expectation in 2018 is for the government to invest more on modular refineries to be able to have more petrol locally to address scarcity.’’

Ahmed said that government performed creditably well in the downstream sector last year, adding that it should crown it by building more modular refineries.

According to him, a modular refinery is cheaper to build and it can move from one place to another.

“A modular refinery is capable of refining between 10,000 and 35,000 barrels of crude oil per day,’’ he noted.

He also urged the government to provide incentives that would attract investors to the oil and gas sector.

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