The Federal Government, through the Nigerian Electricity Regulatory Commission (NERC), has issued a directive to electricity distribution companies (Discos) in the country concerning the replacement of phased-out meters.

In a statement, NERC urged electricity companies to embrace technological upgrades.

While there is no immediate directive to phase out Unistar meters, which are not upgradable, the statement noted that these meters will soon become obsolete. The commission emphasized that users of Unistar meters would face vending challenges once the upgrade occurs.

This development comes amid the ongoing metering gap issue in Nigeria. As a result, some Discos have insisted that customers obtain new meters before November 14.

However, in an interview monitored by this platform, NERC Vice Chairman Musiliu Oseni clarified that no official directive has been issued regarding the phasing out of Unistar meters. He reiterated that when Discos remove these meters, it is their responsibility to replace them.

Oseni said, “Operationally, if they say those meters are not upgradable, they can decide to phase them out. But as they remove the meters, based on the rule, they must replace them. It is the responsibility of the Discos to replace them.”

He added, “It’s a win-win for both sides because customers will be frustrated if, at a point, they want to vend, and the meter is rejected. For Discos to remove the meter, they must ensure a replacement mechanism, either through vendor financing, Disco financing, or Meter Asset Provider (MAP) financing, funded by the customer, who must be refunded.”

Meanwhile, on Tuesday, October 15, the Federal Government announced plans to import 1.3 million meters as part of a broader strategy to eliminate estimated billing in the country, which it described as fraudulent.

Minister of Power Adebayo Adelabu, speaking at the Nigeria Energy Summit in Lagos, highlighted that the metering gap is a significant issue that requires collective efforts to address.

Brent crude oil, against which Nigerian oil is priced, gained 23 cents, or 0.31 percent, to settle at $74.45 a barrel on Thursday, while the US West Texas Intermediate (WTI) crude oil lost 28 cents, or 0.4 percent, to $70.67 a barrel after data showed falling crude and fuel inventories in the United States.

US crude inventories fell by 2.2 million barrels to 420.6 million barrels in the week ended October 11, the Energy Information Administration (EIA) said on Thursday.

The inventory change compares with a sizable build of 5.8 million barrels the previous week, which pressured oil prices.

A day before the EIA released its latest numbers, the American Petroleum Institute (API) estimated an unexpected drop in crude oil inventories that helped prices on their way up. The API said inventories had shed 1.58 million barrels in the week to October 11.

Meanwhile, the EIA also estimated an inventory draw in gasoline and another one in middle distillates for the reporting period.

Meanwhile, the European Central Bank (ECB) cut interest rates for the third time this year on Thursday, indicating that inflation in the eurozone is now increasingly under control and the economic outlook has worsened.

This move lent support to oil prices and will likely continue to do that as it makes borrowing cheaper, potentially boosting demand.

Earlier in the week, traders rushed to sell following the latest monthly updates from the Organisation of the Petroleum Exporting Countries (OPEC) and the International Energy Agency after they revised their oil demand projections down, for the third month in a row.

OPEC now expected demand growth this year at 1.95 million barrels per day, down from some 2.25 million barrels per day, at the beginning of the year and the IEA sees oil demand inching up by less than 1 million barrels daily this year.

On the geopolitical front, uncertainty extended of an Israel retaliatory attack on Iran for sending a barrage of missiles almost three weeks ago.

There had been initial reports of striking Iran, a member of OPEC, via its oil and gas infrastructure but the US has convinced the country not to take that approach.

Pressure came as the US Dollar rose in the currency market. A stronger greenback makes commodities like oil which is priced in the US currency more expensive and can hurt demand.

The market is also watching China for more details following its recently announced plans to revive its weakening economy.

The Independent Petroleum Marketers Association of Nigeria (IPMAN) has revealed that despite the directive of the Federal Government that they can purchase petrol directly from Dangote Refinery, an existing agreement binding the Nigerian National Petroleum Company (NNPC) and the refinery, has halted lifting of the product.

This was made known on Wednesday, in a notice to IPMAN members in the Western Zone, issued by the Zonal Chairman, South-West, Dele Tajudeen, after a meeting with top officials of Dangote Refinery on Tuesday.

Investors King reported that on October 11, the Federal Government announced that all petroleum marketers can now negotiate and buy products directly from the Dangote Refinery, Lagos.

A statement by the Ministry of Finance indicated that the decision to allow oil marketers to deal directly with the refinery firm was reached at a meeting of the technical committee headed by the Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun.

The leeway given by the Federal Government has ended the arrangement in which the Nigerian National Petroleum Company Limited (NNPCL) was acting as the sole off-taker of the Dangote Refinery products.

However, after the meeting between the two bodies, IPMAN revealed that the NNPC is still the sole off-taker of petrol from the Dangote Refinery.

According to the marketers, there is an existing agreement between NNPC and Dangote Refinery, and until the expiration of the said agreement, NNPC will remain the sole off-taker of the product from the refinery.

Sadly, IPMAN revealed that the date of the termination of that agreement is kept a secret by the NNPC and the refinery.

IPMAN said, “The IPMAN National Vice President, Zonal Chairman of Western Zone, IPMAN members, and PTD Zonal Chairman met with the Vice President of Dangote Group and many other notable staff members of the Dangote refinery yesterday, October 15, 2024.

“We had a very useful and fruitful discussion on the direct purchase of products from the Dangote refinery.  The Vice President of Dangote confirmed that the Minister of Finance/ Coordinating Minister of the Economy, and the Minister of Petroleum Resources have directed them to commence sales of products to marketers who have duly registered with the refinery, but they are still having a pending agreement with NNPC Ltd which still subsist.

“Until and when the agreement is terminated by either party, the direct sales will still be on hold.”

Meanwhile, IPMAN called on oil marketers who are yet to officially register with the association to do so as fast as possible as only registered members will benefit from the direct lifting of the product.

The statement added, “In view of this, marketers who are yet to officially register as IPMAN members should do so without wasting time as such marketers will not benefit from this opportunity when we eventually commence lifting from the Dangote refinery.”

Before now, IPMAN had accused Dangote Refinery of snubbing them on their demand to directly lift its petrol.

They hinted that the development is a setback on their efforts at making fuel sell cheaper across filling stations in the country.

The President of the Independent Petroleum Marketers Association of Nigeria, Abubakar Maigandi and the President of the Petroleum Products Retail Outlets Owners Association, PETROAN, Billy Gillis-Harry assured that if they are allowed to directly lift petrol from Dangote Refinery, it would make the product sell lesser.