From Lagos to Maiduguri, Sokoto to Port Harcourt, Ilorin and Yola, the tales are similar. The pumps are running dry. Nigerians are at the mercy of black marketers, who smile home after selling petrol at cut-throat prices. Yet, concerned agencies appear helpless in their search for an enduring solution, writes BUNMI OGUNMODEDE
ABOUT three weeks ago, residents of Abuja and its environs woke up to discover that many of the fillings stations had no Premium Motor Spirit (PMS), popularly called as petrol to dispense from the pumps.
Rather than disappear, what began like a moonlight tale in the Federal Capital Territory (FCT) had spread like a fire in the harmattan haze to other parts of the country, pushing the price of the product much higher than the approved pump price for a litre.
In a move to stave off a nationwide scarcity, Finance Minister Dr Ngozi Okonjo-Iweala recently relocated to Lagos. Her mission was to persuade oil marketers to shelve their plan to shun the importation of refined products.
Members of the Major Oil Marketers Association of Nigeria (MOMAN) are bitter that the Federal Government has defaulted in reimbursing them with the investments they sunk into fuel importation, even after the verification of subsidy claims by appropriate regulatory agencies.
Such investments, they argued, were secured as loans from financial institutions and the interests would continue to mount for as long as they delay in paying back.
Despite the queues for products at the filling stations, the Nigerian National Petroleum Corporation (NNPC) claimed it has enough stock at the depots to meet consumers’ demand for one month.
It blamed the long queues on what it called ‘artificial scarcity’, urging Nigerians to avoid panic buying.
The lingering scarcity, which found its way to the Southwest states last week, crept into Lagos, Nigeria’s industrial hub, last weekend, with many stations running out of supply.
On Monday, Lagosians woke up to see long queues at the filling stations. Some motorists, out of desperation, bought fuel from the black market for as much as N200 per litre as against the official price of N97.
In Ondo and Ekiti states, price has gone up as high as N150 a litre at filling stations. The black marketers are at liberty to fix their own prices.
The situation is worse in the North where a four-litre gallon sold for N700 yesterday.
Across the country, more filling stations are joining by the day the growing numbers of outlets displaying the “No fuel” notice.
Major highways and streets in city centres have become sale points for black marketers, who are seen lining the roads with kegs and beckoning on motorists to patronise them.
Isiaka Yahaya, Auditor-General of the Sahara Unit of Petroleum Tanker Drivers (PTD), said the scarcity might linger in Lagos for some time.
According to him, the refusal of marketers to import product is behind the scarcity. Yahaya said that the marketers could not import petrol because of the government’s failure to settle the marketers’ subsidy claims.
But the NNPC, through its acting spokesman Fidel Pepple blamed it all on the destruction of the corporation’s pipeline by oil thieves at Arepo, Ogun State.
Pepple said the corporation has not been able to repair the damaged pipeline following the killing of three of its engineers by hoodlums, suspected to be bunkerers.
The engineers were deployed to fix the vandalised pipeline. Pepple warned that the scarcity, though artificial, might persist if adequate measures are not put in place by the authorities to guarantee the safety of its officials.
According to Pepple, the development has forced the corporation to bridge products by trucks as against the pipeline.
He said the NNPC was forced to the shutdown System 2B – a major pipeline that evacuates between nine to 11 million litres of fuel from Lagos to Ibadan, Ilorin and the North, due to serious vandalism by the oil thieves.
He said: “The NNPC is bridging products from the depots at Atlas Cove, Satellite and Apapa to Ibadan, Kwara and other Southwest states. But it is a little difficult to bridge as much as 11 million litres of fuel per day through trucks, which ordinarily is easily done through pipelines.
“Besides, the repairs of the vandalised pipeline may take some as the corporation would not risk the lives of its engineers in a bid to fix a pipeline, until their safety is guaranteed.”
Beyond the NNPC explanation
There is more to the scarcity than the claim that the damaged pipeline is the cause.
Yahaya alleged that only one depot in Apapa was loading trucks with the product.
He said: “Out of the more than 10 depots in the area, only one was loading trucks and the loading capacity is going down daily.
“Before, 200 trucks were loading, but now, hardly would 60 trucks load in a day.”
He urged the Federal Government to engage the marketers and other stakeholders in the sector in dialogue to ease the suffering of Nigerians.
The National Union of Petroleum and Natural Gas Workers (NUPENG) also urged the Federal Government to call on the NNPC and its Petroleum Pipeline Marketing Company (PPMC) subsidiary to repair the vandalised pipeline at Arepo.
Lagos zonal chairman of NUPENG Tokunbo Korodo, who made the call, warned that the tank farms in Lagos were drying up as a result of the disagreement between the Federal Government and oil marketers who have not been importing enough fuel in recent times.
NNPC still owing FAAC N351b
The NNPC has so far paid N99 billion in 13 installments into the Federation Account. The payment is the refund of the corporation’s outstanding debt which now stands at N351 billion.
The debt arose in the aftermath of a forensic audit, which discovered that the NNPC had, at various times, shortchanged the federation to the tune of N450 billion.
Call for a summit to end scarcity
As Nigerians groan under a fresh round of fuel scarcity across the country, former Kwara State Governor Dr Bukola Saraki is calling for a stakeholders’ summit to find a lasting solution to the problems surrounding the oil subsidy regime.
Saraki, who is the Chairman of the Senate Committee on Ecology and Environment, was the first to raise the motion for the investigation of the subsidy regime in the upper chamber of the National Assembly.
According to him, with the ongoing experience of Nigerians, the time has come for a serious dialogue among the stakeholders.
He said: “The facts are very clear now that it is a difficult issue. What the government should do is to convene an all-stakeholders’ meeting involving the government, oil marketers, labour unions among others to discuss the way forward because we can’t run away from this thing, otherwise we will continue to have scarcity.”
Subsidy claims for
2011 cleared
Going by the records made available by the Federal Minsitry of Finance, N259.3 billion, being the outstanding subsidy claims for 2011 had been cleared by August. Additional N78. 8 billion was paid in respect of this year’s outstanding.
Twenty-four marketers, whose claims were verified, shared N78, 899,342, 509.65. The 2011 outstanding claims of N259, 339,041,657.85 was paid to 79 companies on August 22.
Why marketers
shun importation
As of the last count, the Ministry of Finance has an outstanding debt of N100 billion to pay fuel importers and oil marketers from the 2012 Appropriation.
The non-reimbursement of the subsidy claims to the importers, who has been cleared by the Petroleum Product Pricing and Regulatory Agency (PPPRA) has widened the gulf between the government and the companies.
Already, the importers have not only been incapacitated to import PMS, but facing intense heat from their creditors who demand the repayment of their loans and the accumulated interests.
A MOMAN source, who pleaded for anonymity, said: “It is not that we are not importing, but who would risk massive importation of refined products when huge debts are still hanging and remain unsettled by the Federal Government? This explains why the terminals are not filled to capacity.”
The source blamed the scarcity being experienced nationwide on the delay in settling the outstanding debts.
He said: “While the Federal Government is too slow in its verification exercise, the banks are happy with skyrocketing loan facilities. The same government is not ready to provide guarantees that they will be responsible for the accumulated bank charges.”
Dilemma of Dr. Okonjo
Although, the minister had at a parley she held with oil marketers penultimate week, assured the verified outstanding would be cleared, but the reality that the N888 billion appropriated for fuel subsidy in the 2012 Budget is grossly inadequate is becoming clearer by the day.
The only option open to the former Managing Director of the World Bank is to go cap-in-hand to the National Assembly for more funds.
But as the eye of the world financial regulators, including the Brentwood Institutions, it is unthinkable that an internationally-acclaimed economic expert will indulge in budget deficit.
The advice from the institutions is that developing countries should avoid running a deficit budgetary system.
The PPPRA intervention
A number of policy changes were carried out by the PPPRA’S Executive Secretary, Mr. Reginald Chika Stanley, who was appointed in November 2011.
Stanley’s reforms are designed to bring stability into the supply and distribution of petroleum products by ensuring availability.
