…it contradicts reasons given by NMDRA by blaming it on roads construction
The Nigerian National Petroleum Company Limited was not honest enough when on Tuesday it struggled to make Nigerians know what is responsible for the current fuel scarcity in the country, some industry stakeholders have said
The reasons it gave for the current situation are at variance from what stakeholders and industry operators have long been saying are responsible for fuel scarcity. The stakeholders blame the scarcity on lack of money by NNPC, oil theft and forex
Initially, when fuel scarcity started rearing its ugly head, it was attributed to the floods that ravaged the country. The Nigeria Midstream and Downstream Products Regulatory Authority (NMDPRA) blamed the situation on the floods and when the floods subsided and everyone thought the situation would improve and it was not, it was blamed on bad roads between the southern parts and the northern parts of the country by the agency.
On October 6, 2022, the Nigerian Midstream and Downstream Petroleum Regulatory Authority,NMDPRA, had said the current fuel scarcity in Abuja and other surrounding states was caused by the inability of fuel trucks to have access to Lokoja roads. The regulatory body said the roads have been flooded.
By the time the situation got prolonged more than necessary, marketers started complaining about the insufficient supply from NNPC. It was then discovered that the flood situation was just a cover-up of the crisis that had started brewing weeks before the incident. NNPC was already in bad financial shape. Subsidy had already eaten deep into its revenue.
However, further investigation revealed that the current scarcity of fuel has been caused by three major factors. One is that the NNPC is broke and it has no money to finance importations of fuel into the country. The company, it was learnt is highly indebted to some of its contractors/ suppliers and these contractors/ suppliers are not ready to take the risk of supplying NNPC on credit.
The second point is the crude oil theft which the government allowed to fester for too long.
For Nigeria’s daily production to have reduced to below one million barrels is a major blow to NNPC’s ability to continue with its Direct Sales of Crude Oil and Direct Purchase of Petroleum Product (DSDP) programme.
NNPC currently has no crude oil to give for the programme and because many of the contractors that usually enjoy the programme could not have access to it, proceeds from it sales could not be used to purchase refined products and bring it into the country.
There are products on the Nigeria high seas but the owners of the products cannot take the risk of giving NNPC products on credit.
Other players that could have helped to ease the situation can not because of scarcity of foreign exchange or its high cost. The marketers go to black markets to get their foreign exchange at an average rate of about $1 to N700-800
To attest to the fact that NNPC is broke, the Central Bank of Nigeria recently said that the NNPC which use to remit $3 billion into CBN account during the reign of President Goodluck Jonathan has for some time not been able to do that.
Just last Friday, Emefiele had while speaking in Lagos, disclosed that official forex receipt from crude oil sales into our official reserves had dried up steadily from above $3 billion monthly in 2014, to an absolute zero dollars presently.
The implication of this is that there is no money to import fuel.
It is therefore amazing for it to have been reported on Channels Television that NNPC is blaming fuel scarcity in Abuja and Lagos on the construction of roads in Lagos and Abuja, and not intercity roads. Nigerians are not being told the truth by the managers of the company.
According to Channels Television, the Nigerian National Petroleum Company Limited (NNPC) has blamed the fuel queues in Lagos State and Abuja on some construction projects going on in the state.
NNPC’s Executive Vice President, Downstream, Adeyemi Adetunju, gave this explanation while addressing a news conference in Abuja on Tuesday.
“The recent queues in Lagos are largely due to ongoing road infrastructure projects around Apapa and access road challenges in some parts of Lagos depots,” he said. “The gridlock is easing out and NNPC has programmed vessels and trucks to unconstrained depots and massive load outs from depots to various states are closely being monitored.”
“Abuja is impacted by the challenges recorded in Lagos. NNPC Retail and key marketers have intensified dedicated loading into Abuja to restore normalcy as soon as possible.”
But he assured Nigerians that efforts are ongoing to ensure that normalcy returns as soon as possible.
“We want to reassure all Nigerians that NNPC has sufficient products, and we significantly increased product loading including 24-hour operations in selected depots and extended hours at strategic stations to ensure products sufficiency nationwide,” he assured.
“We are also working with the NMDPRA, MOMAN, DAPPMAN, IPMAN, NARTO, PTD, and other industry stakeholders to ensure normalcy is returned.”
The NNPC, he added, has a “national PMS stock of over 2 billion litres. This is equivalent to over 30 days of sufficiency”.
Fuel scarcity is recurrent in Nigeria, one of the largest producers of crude oil globally. The most recent queues in several parts of the country have left many commuters stranded. Others have resorted to buying the product from black marketers who have cashed in on the situation to sell at exorbitant prices.
The government has said payment of subsidy for fuel is unstainable and has planned its removal for next year, a move that is sure to face pushback.
While NNPC is not to be blamed for this ugly situation it should not compound the agonies Nigerians are going through because of the lack of political will by the government to deregulate the downstream sector of the oil and gas industry.
Fuel in some parts of Lagos fuel sells for N240, N 260 and even N300 per litre in some parts of Lagos.
From all indications, the situation would continue this way till the first quarter of next year