Subsidy: FG, Oil marketers sets up committee to resolve supply impasse

by Tony Ailemen, Abuja

January 2, 2018 | 8:11 pm
  |     |     |   Start Conversation

Federal government in a fresh move to remove bottlenecks in the supply of Petroleum products, has set up a committee that will resolve the intractable problems militating against fuel supply in the country.

Briefing State House Correspondents after the meeting between Presidency team headed by the Chief of Staff to the President, Abba Kyari with oil marketers at the Presidential Villa, Abuja, the Minister of State, Petroleum Resources, Ibe Kachikwu, said the committee will continue deliberations by 10 am at Minister’s office, today, ( Wednesday) to take decision of ways of augmenting marketers shortfall arising from increase in the cost of Petroleum products

BusinessDay sources at the Presidency revealed that issues on the front burner at the meeting has been how to resolve the challenges of subsidy on Petroleum products and irregularities in the issuance of Petroleum Product import licenses.

Some of the major marketers who own storage facilities are said to be uncomfortable with government allocating licenses to people without such facilities who in turn sell those products to them at higher prices.
The Tuesday meeting which was at the instance of the President, was chaired by the Chief of Staff, Abba Kyari.
Recall that President Muhammadu Buhari had expressed sadness inflicted on Nigerians during Christmas and New Year holidays by the non- availability of the Petroleum products at the filling stations
“The consequence was that not many could travel and the few who did had to pay exorbitant transport fares. This is unacceptable given that NNPC had taken measures to ensure availability at all depots. I am determined to get to the root of this collective blackmail of all Nigerians and ensure that whichever groups are behind this manipulated hardship will be prevented from doing so again”
The President while decrying such “unpatriotism” assured that It “will not divert the Administration from the course we have set ourselves”

” Our government’s watch word and policy thrust is CHANGE. We must change our way of doing things or we will stagnate and be left behind in the race to lift our people out of poverty and into prosperity”

According to Kachkwu, the meeting carried out “centric analysis of what really went wrong”

He noted that over the last two years the system had been working well, adding that “NNPC has been managing it properly and suddenly there was this gap”

“So they wanted us to put heads together to find out what went wrong”

He declared that it was not a fault finding meeting, but it dwelt on how to take corrective measures to avoid the challenges the country faced in the last few day.

“what are the things that are creating the difficulties in the system. Because fuel scarcity has been ever lingering 30, 40 year old thing and I think it is to the credit of Mr. President and his government over the last two years that we haven’t had any of this through his policy that he has enunciated”

“We set up a committee which I will head, members included the GMD, most of the parastatals in the ministry, DAPMAN, IPMAN, NOMAN, Labour unions, and we are to meet in my office tomorrow and dig deeper into this thing and find a long term solution”

“This is a major concern that Nigerians should not be made to suffer, that Nigerians do not get through the kind of thing they went through this December. We want to find lasting solution and that is what the committee will come out with in the resolutions tomorrow”

He disclosed that government was ready to find lasting solution to the problem and ensure that Nigerians do not go through it in the future
“We want to find a lasting solution and find evidential basis upon which to punish people. This is a democratic government.”
Kachkwu rejected calls for punishment for defaulting marketers, because according to him,
“You cannot prosecute except you have evidence, I’m 30 years old as a lawyer. So we will need to find that evidence, we will definitely punish those who were things that are wrong, but more fundamental and more importantly is that we want to find lasting solutions and we all want to work more collaboratively”
Speaking at the end of the meeting, President of the Independent Petroleum Marketers Association, ( IPMAN), Elder Chinedu Okonkwo, said the meeting was reassuring as the Chief of Staff to the President assured that local refineries will soon return to full capacity
“We are glad with the promise of the Chief of Staff at the meeting. With what we have heard today, Nigerians should go home and be glad because the issues of constants fuel supply have been resolved”
“This will solve this problem once and for all. They have also assured that the refineries are coming on stream with installed capacity. This is a cherry int news”

Aminu Abdulkadir, Board of Trustees Chairman, IPMAN, said the meeting will address the issue of fuel supply and the future roles of the marketers adding that ” disclosure will be made on plans and ways of augmenting marketers shortfall so that marketers can come back to business”

“If marketers are in the business, nnpc will be augmented. Because hat has happened today is that because nnpc was left alone and it will not be easy for them to manage all the depots, the trucks, the stations”

“It will not be easy for them to manage them. So its a business for all. Before this time nnpc was doing 60 and marketers were doing 40 percent. In fact there was a time nnpc was doing 40 and matters 60percent”

Dapo Abiodun Chairman, of Depot and Petroleum Marketers Association of Nigeria (DAPMAN) explained that marketers were pushed out of the fuel supply through government insistence on selling fuel at N145 per liter, despite increase in price of crude oil.
” From January to December, the price of crude remained relatively stable flowing from the month of September October, crude prices went up and marketers lost the ability to import any sell at N145 per liter.”
” Since the price of crude is directly proportional to refined product, we could not import petrol and sell at N145 any more. And this business is a partnership between marketers and NNPC. Marketers being in a certain volume and NNPC also brings in a certain volume”

“In the past marketers bring in about 60% while NNPC brings about 35 to 40 per cent. But by the month of October marketers completely stopped importing because there no more subsidy so we can’t sell for profit so we have to stop importing. So the burden of importing 100% now fell on NNPC”

“The government in its wisdom has decided that the N145 cap will remain because of what they consider will be consequences on Nigerians. This is a government of the people and they believe Nigerians should not be made to buy fuel for more than N145. So if that is to remain then we have to find other ways to manage the situation so that we will continue to sell fuel at N145”


Tony Ailemen, Abuja

by Tony Ailemen, Abuja

January 2, 2018 | 8:11 pm
  |     |     |   Start Conversation

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