To Stem Growing Fuel Queues, Kachikwu Orders Release of Products in Storage

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Worried about the implications of fuel queues at this time of the year, the Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, on Monday ordered the Nigerian National Petroleum Corporation (NNPC) to release all products on storage to cover for the current shortfalls that might have precipitated the resurgence of fuel queues.

A source at NNPC, who hinted at this development, said although both the minister and the Group Managing Director of NNPC, Dr. Maikanti Baru, were not in the country as at last night, however, Kachikwu immediately responded to the development, having deemed it of utmost national importance.

According to the NNPC source, while Kachikwu was on his way back to the country last night from Vienna en route London, where he had gone to attend the Organisation for Petroleum Exporting Countries (OPEC) meeting, Baru, on the other hand was in London to receive a Forbes award.

“I can tell you authoritatively that the minister reached out to the NNPC this night (yesterday) and asked us to release all products on storage to cover the shortfalls on importation for the next two weeks.

“I also understand that part of the problem is because of lower volume deliveries of cargo, which caused the current shortage. But more vessels, I think about 30 or more are on track to arrive from next week and all should be ok,” the source explained.

The source also hinted that Kachikwu probably saw this coming a long time ago, when he had been warning the NNPC that queues might return to the streets unless they pulled back and allowed private sector players improve their participation on importation, adding that the NNPC, on the contrary had continued to import 100pct.

The source, who hoped that the vessels being expected would arrive on time said Kachikwu’s intervention was just to ameliorate the current situation before it gets out of hand, noting also that it would not last more than two weeks.

Baru had told journalists during the inauguration of NNPC’s Ultra-Mega Filling Station in Sagamu, Ogun State at the weekend that the corporation had in its reserve one billion litres of petroleum products to serve Nigerians during the Christmas period and till end of the year.
However, THISDAY gathered that distribution challenges faced by the NNPC have created scarcity of petrol as only eight out of about 35 functional depots in Lagos had product yesterday.

A market survey conducted by THISDAY showed that the eight depots were selling product at ex-depot price of between N140 and N143 per litre, against the approved government’s ex-depot price of N133.28 per litre.

The Independent Petroleum Markers Association of Nigeria (IPMAN) had at the weekend accused the NNPC of supplying petrol to only the depot owners at coastal price of N117 per litre, only for the depot owners to sell to the independent marketers at ex-depot price of N133.28.
IPMAN also threatened to shut down over 900 filling stations in Lagos and Ogun stations by December 11, if the NNPC continued to undersupply petrol to its members.

The tightening fuel supply, it was learnt, stemmed largely from the Apapa jetty fire incident, which affected the pipelines that transport product from imported vessels to the depots of the major marketers, who depend on NNPC’s imported products.

A source close to the jetty, which is owned by the NNPC but operated by the major marketers, told THISDAY that the fire affected the integrity of the pipelines that supply product from imported vessels to the depots of the major marketers.

“The NNPC had promised that they would complete the repairs within few weeks but up till now, they have not completed the repair work and the market is beginning to feel the impact of the fire. Major marketers now rely on throughput with other depot owners and this means additional cost. NNPC said that they are still running integrity tests on the pipelines,” he said.

The refusal of most private marketers to import petrol as a result of the low margins arising from challenges of accessing forex and the high cost of the product at the international market, also aggravated the situation
There were queues in many parts of Lagos yesterday but the pump price was still N145 per litre.
No fewer than four people lost their lives with several others severely injured when the jetty, which is operated by the major oil marketers caught fire in September when hoodlums tampered with the manifold, which is the connecting pipe to the vessel, to scoop fuel.

Though the NNPC had assured that the damage would be fixed in few weeks, THISDAY gathered that repairs have not been completed.
Baru had assured at the weekend that NNPC had one billion litres of petroleum products and urged Nigerians to ignore any threat of fuel scarcity during the Yuletide.

“As you could see around the country we have a lot of trucks that are siding at almost every filling station. We already have sufficient products that will last till the end of the year, leading to next year. We have an average consumption of 35 million litres per day and at the moment, I have one billion litres of petroleum product in my tanks for the year,” Baru said.

“We will not have any problem; it will not recede. So be assured that God willing, this Christmas and also New Year will be done without any cues – there are sufficient products all over Nigeria.”

He said the threat by IPMAN to embark on strike over instability in price of the product was the saddest thing that could happen, stressing that the N145 per litre of petroleum products remained unchanged.
Meanwhile, the NNPC has said it has no plans to increase the prices of petroleum products both at the ex-depot level and filling stations ahead of the forthcoming Christmas celebration.

It said in a statement from its Group General Manager, Public Affairs, Mr. Ndu Ughamadu yesterday in Abuja that its ex-depot price of petrol was still N133.38 per litre, while petrol pump price remained N143 to N145 per litre.
NNPC said these prices have not changed, and that it has enough stock of petrol to ensure seamless supply and distribution of it across the country.

The corporation enjoined motorists and other users of petroleum products to disregard trending rumours of an impending fuel price hike, adding that it has the full commitment of all downstream stakeholders including petroleum marketers and industry unions to cooperate with it in achieving a zero fuel scarcity this season and beyond.

It also asked motorists not to engage in panic buying or indulge in the dangerous practice of stocking petroleum products in jerry cans at home, noting that its downstream subsidiary companies, the Petroleum Products Marketing Company (PPMC) and NNPC Retail Limited, were fully prepared to ensure that motorists enjoy uninterrupted access to petrol throughout the country.

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