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Fuel Scarcity Persists, NNPC Admits Supply Hitches

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Kerosene
  • Fuel Scarcity Persists, NNPC Admits Supply Hitches

As fuel queues grew longer at the few filling stations that sold the product in Lagos and Ogun states on Thursday, the Nigerian National Petroleum Corporation said it noticed the current hiccup in the supply chain a few days ago.

Motorists lamented that they had to spend many hours in queues for Premium Motor Spirit (petrol), while some petrol seekers with jerry cans complained that the product was not being sold to them and that they had to part with extra money to get it at some of the stations.

Commuters were seen at many bus-stops struggling to get vehicles to different destinations, even as transport operators increased the fares by as much as 100 per cent on most routes.

The long queues of desperate motorists at filling stations in parts of Lagos spilled onto the roads and disrupted the flow of traffic, making commuters and motorists to suffer more pain.

It was gathered that many of the private depots in Apapa, Lagos, where most marketers get petroleum products from for distribution to other states, did not have petrol to load.

The National Operations Controller, Independent Petroleum Marketers Association of Nigeria, Mr. Mike Osatuyi, said although the NNPC had assumed the role of sole importer of petrol into the country, the corporation lacked adequate facilities to discharge and dispense the product without involving the private tank farm owners and marketers.

He said IPMAN members were being given maximum of eight trucks per day at the NNPC depot in Ejigbo, Lagos in the past five days, adding, “The depot has a deficiency of storage. Its tank can only take 60 trucks’ stock, which is not up to half-day loading. So, that is a special problem that has to be addressed. Before, the depot could load up to 120 to 130 trucks in a day.

“If the NNPC says it has enough cargo, let it share it to the depots it has throughput with so that there can be massive distribution of the product across the country. IPMAN is cooperating with the government so that we can get to the end of this issue.”

Efforts to get the comments of the Major Marketers’ Association of Nigeria and the Depot and Petroleum Products Marketers Association were not successful as their spokespersons did not immediately respond to telephone calls.

The Group Managing Director, NNPC, Dr. Maikanti Baru, however, said in a statement on Thursday that the corporation had doubled the daily supply of PMS from 700 trucks (about 27 million to 30 million litres) per day to 80 million litres per day since the hiccup in the supply chain was noticed.

Baru said rumours of a purported increase in the pump price of petrol made some marketers to suddenly start hoarding the product in their quest to cash in on the situation.

“But we swiftly swung into action by doubling our supply nationwide. At the time the rumour started, we had about 30-day sufficiency. The normal daily supply to the nation is 700 trucks, equalling about 27 million to 30 million litres per day.

He added that the NNPC had enough products’ sufficiency that would last up to 30 days, adding that at least cargoes laden with one billion litres of petrol cargoes were heading to Nigerian shores at the end of December, which he said would return the country to a 30-day-plus sufficiency.

Baru said the fuel scarcity would soon fizzle out and warned marketers hoarding the product that they would lose their entire products to motorists if caught.

He commended the NNPC’s sister agencies, the Department of Petroleum Resources and Petroleum Products Pricing Regulatory Agency, for their support in helping to tackle the hoarding of PMS by filling stations.

Meanwhile, the Head of Operations, Lagos Zonal Office, DPR, Mr. Musa Tambuwa, on Thursday called on marketers to shun hoarding or face penalties.

“We are going to ensure that Nigerians are not defrauded. If we find any station engaging in sharp practices, be sure that the arm of the law will not hold back at such defaulters.”

The NNPC also announced that it had achieved 98 per cent automation of all transactions involving the supply, marketing and sale of the various grades and blends of the country’s crude oil across the world.

Its Group General Manager, Crude Oil Marketing Division, Mele Kyari, said the automation, which would be concluded in 2018, had enabled the corporation to achieve an end-to-end monitoring of every barrel of crude oil sold in the country.

Commenting on the firm’s ability to monitor crude oil sale, Kyari said, “Today, at the click of a button, we can tell you how much crude oil is sold, at what price, who bought it and where it has gone to, etc.”

He said the projection was to operate a complete paperless crude oil data management regime in line with the ongoing transformation of the processes, which has witnessed reforms since 2015.

Kyari listed the reforms to include the open bid process of customer selection for lifting and purchase of Nigeria’s crude oil grades, emplacement of efficient crude for product import processes, leading to savings of $1bn in one year, as well as the introduction of improved pricing system.

He explained that the reform had led to the harmonisation of Nigeria’s crude oil data and lifting information, providing access to major internationally recognised reporting agencies like Plat and Argus Media to achieve real time reporting of the nation’s crude oil transactions.

He said this development had enabled the country to eliminate the perennial disagreement with its major stakeholder, the Organisation of Petroleum Exporting Countries, on actual production and lifting figures.

Baru, who signed the MoU on bio-fuels project with the Benue State Government, stated that the project would provide employment for the teeming youths in the state.

“I believe that Benue has what it takes to lead the country in the bio-fuels industry. I hope that your state will soon move from the food basket to the fuel basket of the nation,” he said.

In his remarks, the Deputy Governor of Benue State, Benson Abounu, said the state was happy with the signing of the MoU, a development he noted was a watershed in the nation’s quest to find alternative sources of energy.

The Agasha-Guma bio-fuels project aims at developing an integrated sugarcane plantation and fuel-ethanol/sugar/power plant complex in Benue State through a Special Purpose Vehicle.

The NNPC said the project was expected to create one million direct and indirect jobs for Nigerians on completion, and would produce about 84 million litres of ethanol fuel annually, adding that it planned to mobilise to site by the first quarter of 2018.

In Kano, the DPR sanctioned eight filling stations, just as it confirmed improvement in distribution and supply of the product.

At the end of a three-day check of filling stations within the metropolis, the Acting Operations Controller, Kano Field Office, DPR, Mr. Paul Jezhi, said the team inspected not less than 166 filling stations within Kano.

Jhezi added, “You can see for yourselves that queues have disappeared in our filling stations. This is due to our close monitoring of how stations dispense the product. We also supervise their compliance level, with the stipulated price.

“We were being supplied between 20 and 24 trucks of the product daily, but it has now increased to about 40 trucks in order to correct the shortfall.”

The Kwara State Governor, Alhaji Abdulfatah Ahmed, on Thursday warned petroleum marketers in the state against hoarding of fuel and other infractions, saying culprits would be punished.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Economy

Electricity Consumers Get 611,231 Meters Under MAP Scheme

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Electricity Consumers Get 611,231 Meters Under MAP Scheme

A total of 611,231 meters have been deployed as at January 31, 2021 under the Meter Asset Provider initiative since its full operation despite the COVID-19 pandemic and other extraneous factors, the Nigerian Electricity Regulatory Commission has said.

NERC disclosed this in a consultation paper on the review of the MAP Regulations.

The proposed review of the MAP scheme is coming nearly four months after the Federal Government launched a new initiative called National Mass Metering Programme aimed at distributing six million meters to consumers free of charge.

“The existence of a huge metering gap and the need to ensure successful implementation of the MYTO 2020 Service-Based Tariff resulted in the approval of the NMMP, a policy of the Federal Government anchored on the provision of long-term low interest financing to the Discos,” NERC said.

The commission had in March 2018 approved the MAP Regulations with the aim of fast-tracking the closure of the metering gap in the sector through the engagement of third-party investors (called meter asset providers) for the financing, procurement, supply, installation and maintenance of meters.

It set a target of providing meters to all customers within three years, and directed the Discos and the approved MAPs to commence the rollout of meters not later than May 1, 2019.

But in February 2020, NERC said several constraints, including changes in fiscal policy and the limited availability of long-term funding, had led to limited success in meter rollout.

NERC, in the consultation paper, highlighted three proposed options for metering implementation going forward.

The first option is to allow the implementation of both the NMMP and MAP metering frameworks to run concurrently; the second is to continue with the current MAP framework with meters procured under the NMMP supplied only through MAPs (by being off-takers from the local manufacturers/assemblers).

The third option is to wind down the MAP framework and allow the Discos to procure meters directly from local manufacturers/assemblers (or as procured by the World Bank), and enter into new contracts for the installation and maintenance of such meters.

“Customers who choose not to wait to receive meters based on the deployment schedule of the NMMP shall continue to have the option of making upfront payments for meters which will be installed within a maximum period of 10 working days,” NERC said.

The regulator said such customers would be refunded by the Discos through energy credits, adding that there would be no option for meter acquisition through the payment of a monthly meter service charge.

“Where meters have already been deployed under the meter service charge option, Discos shall make one-off repayment to affected customers and associated MAPs. Such meters shall be recognised in the rate base of the Discos,” it added.

NERC urged stakeholders to provide comments, objections, and representations on the proposed amendments within 21 days of the publication of the consultation paper.

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Economy

Nigeria’s Economy Moving in Right Direction but Slow – Amina Mohammed

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Nigeria’s Economy Moving in Right Direction but Slow – Amina Mohammed

Nigeria is moving in the right direction economically but its movement is not fast, the United Nations stated on Thursday.

Deputy Secretary-General of the United Nations, Amina Mohammed, said this during a meeting at the headquarters of the Federal Ministry of Industry, Trade and Investment in Abuja.

She said the challenges in Nigeria were huge, its population large but described the country’s economy as great with lots of opportunities.

The UN scribe stated that after traveling by train and through various roads in the Northern parts of Nigeria, she discovered that the roads were motorable, although there were ongoing repairs on some of them.

Mohammed said, “This is a country that is diverse in nature, ethnicity, religious backgrounds and opportunities. But these are its strengths, not weaknesses.

“And I think the narrative for Nigeria has to change to one that is very much the reality.”

Speaking on her trips across parts of Nigeria, she said, “What I saw along the way is really a country that is growing, that is moving in the right direction economically. Is it fast enough? No. Is it in the right direction? Yes it is.

“And the challenges still remain with security, our social cohesion and social contract between government and the people. But I know that people are working on these issues.”

She said the UN recognised the reforms in Nigeria and other nations, adding that the common global agenda was the Sustainable Development Goals.

Mohammad commended Nigeria’s quick response to the COVID-19 pandemic, as she expressed hope that the arrival of vaccines would be the beginning of the end of COVID-19.

On his part, the Minister of Industry, Trade and Investment, Adeniyi Adebayo, told his guest that the Federal Government was working hard to make Nigeria the entrepreneurial hub of Africa.

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Economy

N10.7tn Spent on Fuel Subsidy in 10 Years – MOMAN

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N10.7tn Spent on Fuel Subsidy in 10 Years – MOMAN

Nigeria spent a total of N10.7tn on fuel subsidy in the last 10 years, the Chairman, Major Oil Marketers Association of Nigeria, Mr Adetunji Oyebanji, has said.

Oyebanji, who was the guest speaker at the 18th Aret Adams Lecture on Thursday, said N750bn was spent on subsidy in 2019.

He highlighted the need for a transition to a market-driven environment through policy-backed legislative and commercial frameworks, enabling the sustainability of the downstream petroleum sector.

“Total deregulation is more than just the removal of price subsidies; it is aimed at improving business operations, increasing the investments in the oil and gas sector value chain, resulting in the growth in the nation’s downstream petroleum sector as a whole,” he said.

The managing director of 11 Plc (formerly Mobil Oil Nigeria Plc) said steps had been taken, “but larger and faster leaps are now required.”

According to him, deregulation requires the creation of a competitive market environment, and will guarantee the supply of products at commercial and market prices.

“It requires unrestricted and profitable investments in infrastructure, earning reasonable returns to investors. It requires a strong regulator to enable transparency and fair competition among players, and not to regulate prices,” Oyebanji said.

He noted that MOMAN had recently called for a national debate by stakeholders to share pragmatic and realistic initiatives to ease the impact of the subsidy removal on society – especially on the most vulnerable.

He said, “A shift from crude oil production to crude oil full value realisation through deliberate investment in domestic refining and refined products distribution, creates the opportunity to transform the dynamics of the downstream sector from one of ‘net importer’ to one of ‘net exporter’, spurring the growth of the Nigerian economy.

“Effective reforms and regulations are key drivers for the growth within the refining sector. Non-functional refineries cost Nigeria over $13bn in 2019. If the NNPC refineries were operating at optimal capacity, Nigeria would have imported only 40 per cent of what it consumed in 2019.”

Full deregulation of the downstream sector remains the most glaring boost to potential investors in this space, according to Oyebanji.

He said, “As crude oil prices will fluctuate depending on the prevailing exchange rates, it will be astute to trade in naira to avoid inevitable price swings.

“There needs to be a balance between ensuring the sustainable growth of the crude oil value chain (upstream through downstream) and providing value for the Nigerian consumer and the Nigerian economy.”

He said the philosophy should be for the government to put the legislative and commercial framework in place and let the market develop by itself.

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