Encouraged by the Federal Government policy which removed fuel subsidy and throw open the field for equal participation among the downstream petroleum Industry operators, Emadeb Energy Services on Wednesday took delivery of the first cargo of petrol it imported
The ship St Nnene which anchored at Emadeb jetty at Ijegun Egba, Satalite Town, Lagos came with 27 million litres of petrol which price was put at $17 million.
According to stakeholders at the ceremony, if the government can ensure that this is sustained, that is, by creating an enabling environment for sustenance of a fully deregulated downstream, other players would be encouraged to bring more cargoes and this would eventually put paid to the dominance of the Nigerian National Petroleum Company limited.
The vessel, ST Nnene was earlier billed to arrive last week Friday but was held down off Lome waters due to adverse weather, birthed at Ijegun-Egba on Wednesday.
Speaking at the occasion which was witnessed by both government representative and operator, Adebowale Olujimi, Chief Executive Officer, Emadeb Energy Services, said, petrol importation was no longer sustainable and appealed to the government to resuscitate local refining which is the way to go.
According to him: “Petrol importation is not a sustainable way for a country to run. What we saw on Tuesday, when PMS price rose to over N600 per litre, is an indication that the dynamics of the business is a tough one. It requires huge US dollars to bring in this. The way forward is for local refineries to be revived,” he said.
Sadiq Bashir, who representing the Chief Executive Officer of the Nigerian Midstream and Downstream Petroleum Regulatory Authority, Farouk Ahmed, described the development an important milestone since the downstream sector was deregulated.
The elated representative of the NMDRA boss stated: “This is what we have been looking forward to. When we talk about deregulation, people think it’s all about increasing prices. No. Although prices would now be determined by market dynamics, deregulation also opens up the market for other players to come in.
“Yes, we would experience teething problems at first; however, if market forces are allowed to come into play, prices would eventually go down due to high competition. We assure that NMDPRA would continue to ensure quality control of products being sold to the public.”
General Secretary, the Natural Union of Petroleum and Natural Gas Workers, Afolabi Olawale, restated the union position on local refining capacity, saying that that is the best solution to the issue of deregulation.
“If we want to go for deregulation, we should not go for importation. We should not submit our economy to be determined by foreign firms. But since we are there now, the government needs to speed up on palliatives because things are hard on everybody. We also enjoin marketers to shun excessive profiteering,” he said.
The National Controller Operations, the Independent Petroleum Marketers Association of Nigeria, Mike Osatuyi, said issuing licences to independent marketers to import would give rise to competition and fairness in the downstream sector.
He advised marketers to satisfy their customers by selling at fair prices, and dispensing the correct quantity.
Five financial institutions- Polaris, First Bank, Union Bank, Access Bank and Fidelity bank had bankrolled the deal.
This was as foreign exchange rose from N745 to one dollar three weeks ago, to N845 as of Tuesday, and crude price rising to $80 per barrel as of 1:45pm Nigerian time on Wednesday.
Until now, state oil firm NNPCL had enjoyed a monopoly downstream market for years. The firm had singlehanded imported petrol consumed in-country, and had dictated prices.
Since the end of subsidies which cost the country about N12tn, prices of petrol had risen from an average of between N180/N200 per litre, to N614 per litre as of Tuesday.