The Nigerian National Petroleum Corporation (NNPC) has assured Nigerians that it has no plan to increase the pump price of Premium Motor Spirit (PMS), also known as petrol.
In a statement issued on Wednesday by the NNPC spokesman, Ndu Ughamadu, the Corporation explained that the recent increase in bridging allowance to transporters from 6.20 Naira to 7.20 Naira per litre will not affect the prevailing petrol price of 145 Naira per litre.
According to the statement, the clarification was made in Abuja by the NNPC Chief Operating Officer (COO) in charge of Downstream Operations, Mr Henry Ikem Obih.
“Rebalancing Of The Margins”
Mr Obih said there was no plan by government or any of its agencies to review the pump price of petrol above 145 Naira per litre, adding that the rise in the bridging cost was achieved after an adjustment was made in the “lightering expenses” from Four Naira to Three Naira per litre, and the difference transferred to compensate for the cost of bridging within the same template.
The bridging allowance refers to the cost element built into the products pricing template to ensure a uniform price of petrol across the country, while lightering expenses involve charges for moving products to depot area from mother vessels by light vessels, due to the inability of the former to berth in shallow water depth.
“What happened, in simple language, is a rebalancing of the margins allowed and approved for stakeholders. So what the Petroleum Products Pricing Regulatory Agency (PPPRA) did was to take One Naira from lightering expenses and add same to the bridging allowance, that is how we arrived at 7.20 Naira. Therefore, PMS remains at the ceiling of 145 Naira per litre, he said.
“No Risk Of Shortage”
On the availability of product supply, the COO said as at Wednesday, Nigeria has 1.3 billion litres of petrol which translates to an inventory of 36 days.
“What this means is that even if we stop importation or refining of petrol right now, we have enough products in the country to provide for the needs of every Nigerian for a period of 36 days,” he said.
Obih noted that the supply availability was bolstered with the production of petrol from the three refineries located in Port Harcourt, Warri and Kaduna.
“There is absolutely no risk of shortage in supply as we also continue to import, to support the production from the refineries. We have informed the Department of Petroleum Resources (DPR) to enforce the prevailing 145 Naira per litre price regime, and to also ensure that every service station that has fuel is selling to the public,” he said.
The COO reiterated the readiness of the NNPC management under the leadership of its Group Managing Director, Dr. Maikanti Baru, to sustain the existing cordial relationship between the Corporation and the leadership of the downstream industry unions and other stakeholders.
He said the DPR, which is the regulatory arm of the industry, had been alerted to sanction fuel station owners who engage in hoarding, or charge consumers in excess of the approved pump price of petrol.
Dr. Baru had announced the review of the bridging allowance on Monday at a mediation meeting between the Petroleum Tanker Drivers (PTD) and the Nigerian Association of Road Transport Owners (NARTO),
The Petroleum Products Pricing Regulatory Agency (PPPRA) has condemned reports of imminent fuel scarcity in Nigeria.
The agency asked Nigerians to ignore claims that fuel queues may return to retail outlets over the 660 billion naira debt owed petroleum marketers by the Federal Government.
In a statement issued on Thursday, the PPPRA disclosed that Nigeria has months of Premium Motor Spirit (PMS) sufficiency.
Contrary to some speculations on the status of kerosene, the agency noted that the product was fully deregulated and urged Nigerians to avoid any form of panic-buying.
“The attention of Petroleum Products Pricing Regulatory Agency (PPPRA) management has been drawn to the news, stories and speculations in the media of an imminent fuel scarcity over Marketers’ unpaid 660bn naira debt and other sundry issues.
“The stories, under reference, claimed among others that ‘fuel queues may return to retail outlets across the country anytime soon, following the Federal Government’s inability to settle marketers’ 660bn naira debt’ and non-availability of foreign exchange (FOREX) to fund fuel imports.
“PPPRA wishes to state unequivocally, that these stories are gross misrepresentation of available facts at our disposal, hence misleading.
“For the avoidance of doubts, the National Petroleum Products Stock data and import plan currently indicates that the country has two (2) months Premium Motor Spirit (otherwise known as PMS) sufficiency.
Desist From Panic-Buying
“Hence we want to assure motorists and commuters alike, that the products supply situation is robust and able to cater for the fuel needs of all Nigerians, pending when ongoing challenges are addressed.
“As a corollary to the above, PPPRA also wants to inform that contrary to a widely-held belief on the status of HHK (Kerosene), the product is fully deregulated.
“We hereby appeal to all Nigerians to remain calm and desist from any form of panic-buying, as we assure of our total commitment to adequate products supply and distribution across the country in line with our mandate.
“We also appeal to all depot owners to adhere strictly to the subsisting truck-out principle in order to ensure that products get to retail outlets across the country in a seamless manner.
“The Agency shall not hesitate to apply appropriate sanctions where necessary,” the statement read.
Nigeria’s Minister of State for Petroleum, Dr. Ibe Kachikwu, says the Federal Government will work to maintain the new petroleum products pricing template which pegs the price of petrol between 135 and 145 Naira per litre.
The Minister said that the government is presently unable to consider fixing a new price for petrol without considering some of the market variables that gave rise to the current petroleum pricing template.
He made the remarks in Abuja on the sideline of an event organised by the Petroleum Products Pricing Regulatory Agency (PPPRA) as well as the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN).
“Obviously as you look at foreign exchange differentiation, it will impact and the worst thing you could do is to go back to the era when we unilaterally fix prices.
“What we’ve also been doing is to watch the prices and make sure that they do not take advantage of the common man, making sure the template is maintained,” Kachikwu told the gathering.
In her remarks, the acting Executive Secretary of PPPRA, Sotonye Iyoyo, explained how the new petroleum products pricing template has stabilised products distribution in Nigeria.
“The appropriate pricing framework policy put in place by the Minister for Petroleum Resources in May 11, 2016 has gone a long way in achieving key deregulatory pre-conditions such as full cost recovery, free entrance and free exit of players.
“Global competitive product pricing policy, limited government intervention and control of pricing (as well as) distribution and creation of the enabling environment attracts private sector capital,” she stated.
On his part, PENGASSAN President, Francis Johnson, expressed satisfaction with the new pricing template.
He, however, appealed to the legislature to quickly pass the Petroleum Industry Bill (PIB) into law to address other issues in the sector.
“We want to commend and also advise that the National Assembly should see how they can pass this bill (PIB).
“It’s very important that we have that bill because it’s the legal framework and when we also have the bill passed into law, definitely the issue of pipeline vandalism and so many issues embedded in the industry will also be taken care of so that we can know that yes, the industry is moving forward,” he said.
The Nigerian government says it will not increase the pump price of petrol despite a demand that it should consider the removal of the price cap.
This is coming as a reaction to a request made by the forum of former Group Managing Directors of the Nigerian National Petroleum Corporation (NNPC) on Sunday.
They had called for the removal of the price cap of 145 Naira per litre, which was set in May by the Minister of Petroleum, Dr. Ibe Kachikwu, insisting that it was not harmonious with the liberalisation policy of the Federal Government.
A statement by the NNPC’S spokesman, Mr Garba Mohammed, said the 145 Naira per litre price cap did not go well together with the liberalisation policy when factors such as the foreign exchange rate, crude cost and Nigerian Ports Authority charges remain uncapped.
The price cap had been set when the dollar exchange rate at the parallel market was less than 300 Naira, with the government saying the decision was to ensure that marketers do not sell petrol at their desired price.
Giving the government’s position on the request for price review, the acting Executive Secretary the Petroleum Products Pricing Regulatory Agency (PPPRA), Sotonye Iyoyo, said that the agency would not accept the advice.
Mrs Iyoyo pointed out that the proposal was the personal opinion of the former Group Managing Directors of the NNPC.
“I am not aware that the government is planning any fuel price increase. We are in a liberalised market already,” she insisted.
On his part, the spokesman for the NNPC, Garba Mohammed, also described the advice, saying it was just an “opinion”.
The former Group Managing Directors of the NNPC also expressed concern over the declining production level of crude oil in Nigeria and its consequences on the environment and the nation’s revenue.
The Lagos State Zonal Chairman of the Nigeria Union of Petroleum and Natural Gas Workers (NUPENG) has blamed the Nigerian National Petroleum Corporation (NNPC) for the fuel scarcity.
Mr Tokunbo Korodo was a guest on Channels Television’s Sunrise Daily on Wednesday.
“The way I’m looking at it, the NNPC is the main cause of the fuel scarcity, other stakeholders are not complementing the efforts of the Federal Government while they claim they don’t have access to fuel.
“The Federal Government promised to make fuel available to them, why are they not giving it to them and sought it out for Nigerians?” he questioned.
Answering a question on why the depots were not loading, the NUPENG Chairman said: “Because they don’t have fuel.
“The Minister (Dr. Ibe Kachikwu), being the policy maker, is entitled to his opinion, but what I’ve seen so far today (Wednesday), the situation is not encouraging.
“Capital Oil, being the storage facility of the NNPC in Lagos, didn’t load fuel yesterday and even today, same with MRS.
“The Minister is just using Nigerians as experiment and we don’t need that,” he maintained.
Mr Korodo, however, advised the Minister of State for Petroleum to summon a stakeholders’ meeting in order to solve the issue of fuel scarcity.
“The Minister is supposed to have called a stakeholders’ meeting, especially those that have invested in the infrastructure in the oil and gas industry.
“Whatever the problem may be, they should sit down and resolve it because we can’t wait for gradual production of fuel,” he added.
Oil workers under the aegis of Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) have shut down operations of the Petroleum Products Pricing Regulatory Agency (PPPRA) in the Federal Capital Territory (FCT).
The workers are protesting the alleged imposition of an acting Executive Secretary on the agency.
The Chairman of PENGASSAN, PPPRA Branch, Mr Victor Ononokpono, led the protest staged on Tuesday.
The protest is coming barely a week after the immediate past Executive Secretary of the PPPRA, Farouk Ahmed, was removed by the Presidency and arrival of a senior staff of the Nigeria National Petroleum Corporation (NNPC), Mrs Eunice Iyoyo, to resume as acting Executive Secretary.
Mr Ahmed had on Thursday, February 18, handed over management of the agency to the most senior official of the organisation and General Manager, Administration, Mr Moses Mbaba, as directed by the office of the Secretary to Government of the Federation.
The protesting oil workers are asking the Federal government to make a pronouncement to resolve the confusion the double nomination has caused, saying their protest would continue until the matter is resolved.
The Department of Petroleum Resources (DPR) in Nigeria has warned petroleum products depots and filling stations owners against products diversion, hoarding, pump manipulation and selling products above government approved prices.
The Director of the DPR, Mr Mordecai Ladan, gave the warning in Abuja on Monday while addressing reporters over the purported resurgence of fuel scarcity in some parts of Nigeria.
Mr Ladan warned that any petroleum products marketer found to be under-dispensing or selling products above government regulated prices shall be suspended for a minimum of two months.
“Marketers caught diverting or hoarding the products for profiteering shall be sanctioned with a fine of two million Naira and have their operating license revoked and prosecuted for national economic sabotage,” he said.
The DPR Director also mentioned that the DPR was collaborating with Petroleum Equalisation Fund and Petroleum Products Pricing Regulatory Agency to ensure that defaulters would be sanctioned accordingly.
Meanwhile, all DPR Offices nationwide have been directed to step up their monitoring activity and ensure full compliance by marketers.
The Petroleum Products Pricing Regulatory Agency, PPPRA, has threatened to shut down any filling station in the country selling petrol above 97 Naira per litre.
The agency has also given an assurance that it has not approved any increase in the price of the product, neither are there any plans to do so.
The Executive Secretary of the PPPRA, Farouk Ahmed said: “The petroleum products regulatory agency hereby assures Nigerians that the official pump price of Premium Motor Spirit remains 97 naira per litre, as the agency has not approved any pump price increase.”
He added that there were sufficient quantities of the product in the country to guarantee uninterrupted supply, and that all petroleum marketers should release products in their tanks and depots for sale.
To ensure compliance with its directive, the PPPRA said that it would be working with the Department of Petroleum Resources, DPR, to monitor the situation at all retail outlets.
The agency also assured Nigerians that the official pump price of petrol remains 97 naira per litre.
In a statement signed by the Executive Secretary of the Agency, Mr Farouk Ahmed, the agency made clarification following reports that some petroleum marketers are hoarding petroleum products in the vain anticipation of fuel price increase.
The statement further explained that there are sufficient products country to guarantee uninterrupted fuel supply and motorists are therefore advised to shun panic-buying.
Mr Ahmed also added that loading of products has been uninterrupted in all NNPC depots across the country.
The agency directed all petroleum marketers to release for sale products in their tanks and depots and at the officially approved pump price.
The agency promised to work with the Department of Petroleum Resources to ensure compliance at all retail outlets in the country.
The Nigerian Extractive Industries Transparency Initiative (NEITI) has released yet another damning report on the petroleum sector with key findings on subsidy payments, crude oil theft wherein it accused the Petroleum Products Pricing Regulatory Agency (PPPRA) for disparities in subsidy payments to the tune of N175.9 billion during the year under review.
For the period under review, 2009-2011, the report claimed that Nigeria recorded a total crude oil production of over 2.5 billion barrels from which the federation earned total revenue of $143 million which runs into over N21trillion.
The report which was presented by NEITI’s chairman, Ledum Mitee on Monday, explained that the federal government made total subsidy payments of N3trillion to importers of refined petroleum products from 2009 to 2011.
But the disparity between subsidy claims paid from the federation account and the PPPRA was N175.9 billion during the same period, the report revealed.
$10.9 billion Stolen Crude Oil
It also stated that crude oil theft and deliberate sabotage remains a financial drainage for the country with over 136 million barrels estimated at $10.9 billion lost during the year under review.
The Minister of Finance, Dr Ngozi Okonjo Iweala had pointed out cases of non-remittances and called for a joint review of the report by all relevant agencies.
Some of the recommendations are that PPPRA should remit over N4billion arising from recovery collected into the federation account.