Minister, oil marketers parley on fuel import

Minister, oil marketers parley on fuel import

It was learnt that four sub-committees were constituted at the meeting, which was chaired by the Minister of State for Petroleum Resources, Ibe Kachikwu, at the ministry's headquarters in Abuja.

The meeting, which was presided over by the Chief of Staff to the President, Alhaji Abba Kyari, wss held at the old Banquet hall of the Presidential Villa, Abuja.

In a presentation to the Joint Senate and House Committees on Petroleum Downstream on Thursday, Dr. Kachikwu explained that it was imperative to explore options which would open up the market and allow oil marketers to import petroleum products and complement the ongoing efforts by the NNPC to sustain the sanitization of the products supply and distribution matrix.

On sanctions against alleged erring marketers, Mr. Kachikwu said even Nigerians who suffered during the crisis would want to be sure a lasting solution was found to the crisis, by finding evidence upon which to punish people.

Kachikwu, however, proffered three alternative solutions to pump price increase: getting the Central Bank of Nigeria (CBN) to introduce a modulated foreign exchange rate specifically for importers of the product; giving the marketers significant tax adjustments to enable them to absorb the high cost; and a plural pricing system whereby the NNPC would continue to sell at N145 through its numerous outlets while the marketers are allowed to fix their own price.

According to him, part of the reasons for scarcity are the strike by the Petroleum and Natural Gas Senior Staff Association of Nigeria on December 18, smuggling due mainly to price arbitrage, false threat of price hike by NNPC leading to hoarding, diversion and smuggling and insinuation of supply gap. "I don't have one (evidence) yet; if you have one, I will like to have it".

The chairman of DAPPMAN, Dapo Abiodun, said the meeting was important, as it gave all participants opportunity to find out what really caused the scarcity.

Its landing cost is N171 per litre and the Federal Government has said nobody should sell above N145.

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The National President of the Independent Petroleum Marketers Association of Nigeria, Chinedu Okoronkwo, said with yesterday's meeting, "Nigerians should go home and be glad because the issues of constant fuel supply have been resolved".

He said there was no evidence to punish any marketer for hoarding petrol, assuring all stakeholders that part of the demands of the meeting was to name marketers who erred. So, government has to find a way and ensure that marketers themselves import alongside NNPC and still sell at N145.

He however stated that ultimately what the country needed is to have its refineries working, noting that it makes better business sense to add value to crude oil than sell the commodity raw.

The situation, from our point of view, is that from January to December, the price of crude remained relatively stable.

The marketers stopped importing the product, making NNPC the sole importer since the removal of Petrol Support Fund (PSF) also known as subsidy.

"They (government representatives) have also assured us that the refineries are coming on stream with installed capacities".

Other members of the Kachikwu committee are the Group Managing Director, NNPC, Maikanti Baru, most parastatals under the ministry, IPMAN, DAPMAN and labour unions, among others.

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