For weeks, things have been tough for airlines, because of the scarcity of aviation fuel otherwise known as Jet A-one. Despite all efforts, the problem remains unsolved. KELVIN OSA-OKUNBOR reports that the on-going collaboration among airlines, regulators and fuel marketers may end the impasse.
These are not the best of times for stakeholders in the aviation sector. From domestic airline operators to passengers, even to regulators, the scarcity of aviation fuel, otherwise known as Jet A-One, has become a nightmare.
The problem, which has been lingering in the last few months, has been hurting operators who bear the burden of huge financial losses caused by disruption in flight operations. It has also left bitter taste in the mouths of passengers, who agonise daily over occasional delays and flight cancellations.
By extension, the spate of near-air rage by aggrieved passengers demanding to know the status of their flights, for which airlines are unable to provide response, has continued to pose a serious challenge to the industry regulator Nigeria Civil Aviation Authority (NCAA).
The scarcity of aviation fuel, which hit the industry, has pit many passengers against airline personnel at airports nationwide, even as allegations of sabotage are raging among fuel marketers and the affected airlines. This has put NCAA under tremendous pressure, as it battles to difuse the tension generated by passengers’ legion of complaints.
Investigations, however, revealed that aviation fuel is not only unavailable; the fluctuation in the price of the product in the last few months was also an issue that underscored the hiccups in its supply chain. This partly explains why the scarcity appears to have defied previous attempts to resolve it.
Two former ministers of aviation, Princess Stella Oduah and Chief Osita Chidoka, are said to have set up Ministerial Committees to resolve the crisis. But the move may have failed to yield results, as the problem continued to put the stakeholders in the industry under pressure.
Already, many airlines, including Arik Air, have scaled down their operations on some routes because of the scarcity. While absolving themselves of blame for the problem, the affected airlines also said that marketers might be grappling with infrastructure challenge.
However, some players, who spoke with The Nation, put the blame for the scarcity at fuel marketers’ doorstep. For instance, an aviation security expert, Group Captain John Ojikutu, accused fuel marketers of creating the scarcity to increase the price of the product.
As far as Ojikutu is concerned, airlines and marketers have questions to answer. He said: “Yes, the airlines are shouting. Are the marketers shouting? Are they concerned? What exactly is the problem? Is it a problem of scarcity or one of cost?
“If it is a problem of cost, is it that of the marketers or that of airlines? Cost in what form? Is it that it is high or because the marketers are not getting foreign exchange?”
He said there was something the government should look into. “It is a cabal. This is why the NCAA should be involved in providing aviation fuel,” he said.
According to Ojikutu, the NCAA must be involved in the importation, distribution and marketing of the product. ‘’It should find out why the airlines are not getting fuel. That is why I said there is a problem somewhere, because only the airlines are shouting; the marketers are not,” the expert said.
Worried by the effects of the scarcity on their operations, Airline Operators of Nigeria (AON), the umbrella body of domestic carriers, called on the Federal Government to step in. Its Chairman, Captain Nogie Meggison, urged the government to, urgently, address the acute shortage of aviation fuel.
Meggison said the call became imperative because of the consistent unavailability of the product in the past few weeks. He lamented, for instance, that the problem has led to 50 per cent delays or cancellation of flights.
He said: “We have been forced to cry out over this perennial problem because it continues to put us in difficult situation to go the extra mile to fulfil our obligations to our customers in spite of the inconveniences that go with it. However, we are at the mercy of oil marketers and many times our hands are tied such that we are left with no other option than to cancel flights.”
The AON chief alleged that apart from the shortage of Jet A-1, marketers have been increasing the price to unbearable levels. “Till April this year, I bought Jet A1 Fuel for N105 a litre. About a month ago, the price jumped to N145. Two weeks later, it rose to about N200 a litre. Today, the price has skyrocketed above N200 a litre. This has greatly increased our operational cost,” he said.
Ojukuta said considering that cost of fuel accounts for about 40 per cent of operational costs of most airlines, the astronomical rise in price of the fuel by over 100 per cent had equally increased operational costs. In the light of this, he said, operators’ feasibility studies and financial projections were threatened, thereby putting the airlines in financial difficulty.
The AON chair lamented that in spite of these, operators could not increase ticket prices in order not to discourage customers that have been seriously stretched due to the economic hard time facing them. He said the economic downturn has reduced the disposable income of many airline customers.
He said: “For most of them (customers) now the alternative means of travel is by road; our major competitor. It should be put on record however, that road transport uses Premium Motor Spirit (PMS) also known as petrol, which is highly supported or assisted by the Federal Government with exchange rate of N285 and available to marketers.
“On the other hand, airlines don’t have such foreign exchange support or availability from government with regards to helping to make Jet Fuel available to airlines or at an affordable price.”
He, however, said operators earlier this year met the Minister of State, Aviation, Hadi Sirika, to seek a solution to the problem. The minister, according to him, assured the delegation of his assistance.
While operators await the government’s intervention on the matter, they have also called for the reviving of the Aviation Turbine Fuel (ATF) at Warri Refinery and the pipeline -hydrant system of supplying aviation fuel to the Murtala Muhammed Airport (MMA), Lagos.
The operators said apart from reviving the Warri Refinery, the Atlas Cove and Mosimi pipelines -hydrant system earlier used for supplying aviation fuel to the airport should also be fixed.
It was learnt that before the pipelines were shut in 1996, aviation fuel hydrant at the Murtala Muhammed Airport was used to supply fuel to aircraft through the pipeline from Atlas Cove and Mosimi.
Meggison said the Nigeria National Petroleum Corporation (NNPC) should look into the possibility of reviving the pipelines, which must have become rusty, having been abandoned for 18 years. “We need NNPC to revive this pipeline so that airlines can get cheaper and cleaner aviation fuel,” he said.
He pointed out that one of the causes of high cost of aviation fuel is the cumbersome chain of distribution and supply it has to pass through before getting to airline operators.
Pumping fuel using pipeline and hydrant, the AON boss said, is safer and more cost effective compared to using tankers and fuel bowsers. He added that airports do not use tankers for fuel distribution these days.
Fed Govt’s intervenes
Bad as the situation is, stakeholders, especially operators may soon heave a sigh of relief. This is because the Federal Government said it is engaging stakeholders in the aviation fuel supply chain to ensure availability of the product.
Speaking through the NCAA, the government said it was engaging fuel marketers to clear hurdles in the supply of the product, which had ripple effects on airline operations for weeks.
The regulatory authority said it was aware of the prevailing scarcity of Jet A1, which has inevitably led to flight cancellations and delays by the airlines, adding that it has also taken cognisance of efforts being made by the airlines to ensure that passengers were ferried without any hitches.
Last month, Arik Air said it was grappling with flight schedule disruptions caused by severe scarcity of aviation fuel across the country.
Its spokesman, Adebanji Ola, said since the beginning of this year, Nigeria has been grappling with inadequate supply of aviation fuel leading in most cases to shortages of the product and consequently the disruption of flight operations.
Ola said: “The airline operates an average of 120 daily flights, requiring about 500, 000 litres of fuel daily. Due to the large number of domestic and international flights, it is the most impacted by the inability of oil marketers to meet its daily fuel requirements on a timely and consistent basis. This has forced the airline to postpone flights while waiting for the fuel marketers to source and deliver the product.
“On many occasions, despite all efforts in engaging the marketers, fuel could not be sourced, and flights may eventually be cancelled, causing not only revenue loss for the airline but also inconveniencing passengers.”
He, however, identified marketers’ supply and infrastructural challenges as some of the key factors responsible for the epileptic supply of aviation fuel. He explained: “At the root of the fuel supply crisis is low stock due to the inability of marketers to source for foreign exchange to import more Jet A1 fuel into the country.
“There is also distribution challenge, as the discharging of vessels bringing Jet A1 and other petroleum products are done in the same jetty. Loading various trucks for distribution to cities like Kano or Abuja takes considerable effort and time.
The situation in the north is even more difficult since the product takes longer to be delivered due to the trucking distance. Oil marketers have also resorted to trucking of aviation fuel to the airports because hydrants are not consistently available at the airports.”
Ola said while the Federal Government and oil marketers were working hard to address the supply and distribution challenges, operators had appealed to customers to bear with them, as they might experience flight delays and cancelations because of the prevailing scarcity of aviation fuel across the country.
It remains to be seen how the deal with oil marketers will resolve the problem. But until that happens, it remains complaints galore for various stakeholders in the aviation sector.
