NNPC Unveils Strategies to End Current Fuel Scarcity in Next Few Days

Minister of State for Petroleum Resources, Dr. Ibe Kachikwu

*Seeks To Make Nigeria Net Exporter As Senate C’ttee Summons Kachikwu

Apparently miffed by the controversy generated by the declaration of the Minister of State for Petroleum, Dr. Ibe Kachikwu, that the current petrol shortages could last up to two months, the Nigerian National Petroleum Corporation (NNPC) has unveiled strategies to end the scarcity within the next few days.

ThisDAY Live report continues:

The corporation has also reassured Nigerians that it was on top of the petroleum products supply and distribution situation, and remained committed to eliminating this endemic issue once and for all within the next few days.

NNPC’s Group General Manager in charge of Group Public Affairs Division, Mr. Garba Deen Muhammed, said in a statement last night that in the medium term, the corporation was working on sustainable strategies to permanently address the issues and challenges facing the midstream and downstream sectors.

According to him, the overarching objective is to make Nigeria a net exporter of Petroleum products as was the case in the 1970s.

“Our commitment to ramp up our local refining capacity and availability remains unwaivered with the ongoing rehabilitation works targeted at running all Refineries at a minimum 70 per cent capacity utilization within the next eight to nine months. This is in addition to our initiative of increasing the combined capacity of the domestic refineries through co-locating smaller but cost efficient modular refineries within the existing refineries premises within a time frame of 12-24 months,” Muhammed explained.

He further stated that as a result of the challenges that major oil marketers faced in contributing their supply quota due to constraint in accessing foreign exchange and outstanding subsidy obligations, the corporation was burdened with the obligation to guarantee almost 100 per cent in the national supply.

Muhammed noted that since the domestic crude oil supply of 445,000 barrels per day could only guarantee about 50 per cent of the 45 million litres national requirement for petrol, NNPC had secured presidential approval to take additional crude oil volume to guarantee national supply of petrol.

To curb storage and logistics challenges, he said the corporation was working on a joint partnership with technically and financially capable investors to ensure that petroleum products transportation and storage facilities were efficiently operated on an open-access common-carrier user-tariff basis.

“Some of these depots will be nominated as strategic reserves while we take possession of a strategic reserve vessel in the next three months. Tangible results will be delivered within the next three – six months. Changes usually take time, effort and a lot of focus. We understand the plight of Nigerians and the impact on the overall economy. We genuinely empathize with the attendant sufferings and wish to reassure that we are focused and committed to bring an end to this situation within the next few days and we kindly call on all Nigerians to partner with us on this journey to allowing the whole process of change come into fruition,” he explained.

Muhammed further explained that the current administration inherited a huge catalog of issues and problems in the downstream sector not limited to arrears of subsidy payments to oil marketers, corruption and inefficiencies in the supply and distribution chain, incessant vandalism of pipelines, and refineries poor performance.

According to him, a combination of these issues resulted in most oil majors completely pulling out from the importation business and NNPC assuming a near 100 per cent importation obligation without the necessary logistics put in place.
He said in line with the change agenda of this administration, NNPC had initiated and made progress on various key solutions to providing a lasting end to most of the issues.

One of the issues that had been successfully addressed, according to him was the unpaid arrears arising from the subsidy regime had necessitated most oil marketers to stop all forms of involvement in petroleum products imports.

“Thankfully, with the firm support of Mr. President and the National Assembly, we greatly reduced this debt burden and since January 1, 2016 we have been able to eliminate subsidy payments by managing prices at current levels through price modulation. This has resulted to savings of over N100billion monthly for the nation,” he added.

He also added that the nationwide petroleum supply and distribution had been ramped up to all states to ensure product availability in the country, stressing that the current supply to states was in excess of the normal consumption especially in the five major consuming cities.

Muhammed also stated that monitoring had been intensified to ensure full compliance with approved prices.

According to the NNPC spokesman, violations of approved prices and hoarding of petroleum products attracted the following penalties:

“Level 1: Giving out of petroleum products free to the public. Level 2: Sealing off fuel stations found to be hoarding petroleum products and payment of a fine. Level 3: Withdrawal of Marketer’s licence,” he explained.

He said any government official found conniving/wanting would be sanctioned accordingly in line with public service guidelines and procedures.

Muhammed also encouraged the general public to report product hoarders and saboteurs of this administration’s change efforts, adding that they are wittingly fighting every bold change effort currently being put in place.

He also charged motorists and other fuel users to shun panic buying and undue return trips, stressing that this attitude emboldens marketers to hoard products.

“Supply constraints due to foreign exchange challenges are being resolved through collaboration with the Central Bank of Nigeria on innovative ways of closing the gaps in accessing foreign exchange. Similarly, as a result of credible leadership provided by the Minster of State, Petroleum Resources/Group Managing Director, NNPC, the major international upstream oil companies have indicated their willingness to support major oil marketing companies with some of the required foreign exchange. We are vigorously pursuing an improved model for ‘crude oil for refined product’ exchange (the Direct Sale – Direct Purchase arrangement) which eliminates inefficiencies with an attendant cost saving for the nation of about US$1 billion. This will guarantee sustainable product supply to the nation,” Muhammed explained.

Meanwhile, disturbed by the protracted fuel scarcity across the country, the Senate Committee on Petroleum (Downstream) yesterday summoned, Kachickwu, to appear before it today and explain why fuel scarcity has continued unabated.

The resolve to summon Kachikwu was the fallout of the committee’s oversight visit to major petrol stations in Abuja metropolis Monday.

During the tour, the committee expressed concern over non-availability of petrol in many stations following lack of supply to Abuja from the Suleja depot of the NNPC.

According to the committee’s acting Chairman, Jibrin Barau, summoning Kachikwu had become imminent in view of the grave effects of the scarcity on the masses.

Barau disclosed that on-the-spot-assessment exercise carried out by the committee was spurred by the concern expressed by the Senate President, Bukola Saraki, whom he said asked the committee to intervene and ensure that the crisis was promptly nipped in the bud.

Provoked by the seeming unpromising state of the scarcity, Barau described the situation as unacceptable.

“This situation is very bad and unacceptable; hence, the need for the minister to appear before us tomorrow (today) and unveil his plan on the way out of the chaos to us.

“Even if he doesn’t have any plan yet out of the lingering problem, the Senate President and the entire members of the committee are more than ready to rub minds with him for that needed purpose,” Barau said.

Also speaking on the development, a member of the committee and Senate Minority Whip, Philip Aduda, emphasized the need for the federal government to promptly bail Nigerians out of their current travails.

Aduda said Nigerians were not interested in the current decision of leaders of All Progressives Congress (APC) to engage in name calling over the scarcity, noting that all they care about is the availability of fuel in all parts of the country.

“The government should look for petrol and ensure that it is given to the people. The current situation is unacceptable; we are Nigerians and it will be bad for us to continue remaining in queues.

“If the APC leaders like, let them blame themselves; that is their problem but the most important thing is for us to have fuel in Nigeria. That is what we are looking for and that is what we want. We want to see all these queues disappear,” he stated.

During the tour, independent marketers put the blame at the doorstep of NNPC, pointing out that the corporation had failed to make adequate supply available to petrol stations in all parts of the country.

One of the marketers at Forte Oil, Maitama, for instance, said whereas NNPC used to supply him between five and six tankers of fuel daily, the supply has now been reduced to three tankers daily.

On the other hand, Oando, Wuse Zone Four’s Manager, Isa Friday, said for a long while, he had not received any supply from NNPC depot in Suleja.

Fuel Scarcity: Senate Summons Kachikwu

Vanguard reports that worried by the unending nationwide fuel scarcity, the Senate, yesterday, summoned the Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, to appear before it today.

The development came just as senators of the Peoples Democratic Democratic Party, PDP, charged President Muhammadu Buhari to immediately take charge of the country and live up to his campaign promises, which they noted, centred on positive change for the country.

Kachikwu was summoned by the Senate Committee on Petroleum Resources (Downstream), after the committee carried out on-the-spot assessment of the crisis in major filling stations within Abuja metropolis.

Members of the committee were angry that many filling stations were not selling the product due to alleged lack of supply from the NNPC depot at Suleja, leading to long queues of motorists waiting under the scorching sun for the non-available product.

The committee’s Acting Chairman, Jibrin Barau, alongside two other members, said the Petroleum Minister must definitely appear before them today to explain what led to the situation and possibly proffer a lasting solution.

Barau, who addressed journalists after the assessment of some filling stations, described the situation as not only pathetic but also bad, stressing that it must be urgently arrested.

He said the development made the Senate President, Dr. Bukola Saraki, to call on the committee to swing into action as a way of bailing Nigerians out of the crisis.

He said:  “This situation is very bad and unacceptable, hence the need for the minister to appear before us tomorrow (today), and unveil his plan of a way out to us. Even if he doesn’t have any plan yet out of the lingering problem, the Senate President and the entire members of the committee are more than ready to rub minds with him for that needed purpose.“

Live up to promise of change, PDP senators tell Buhari

On his part, Senate Minority Whip and a member of the committee, Senator Philip Aduda, who said he was speaking for PDP senators, called on the Federal Government to arrest the situation fast by making fuel available to Nigerians, adding that what Nigerians needed was fuel and not blame game.

He tasked President Muhammadu Buhari to live up to his campaign promises of delivering change to Nigerians. According to him, what Nigerians are passing through at the moment is unacceptable.

His words: “The government should look for petrol and ensure that it is given to the people. It is unacceptable, we are Nigerians and it will be bad for us to continue remaining on queues. If the APC leaders like, let them blame themselves, that’s their problem but the most important thing is for us to have fuel in the Federal Republic of Nigeria.

“That is what we are looking for and that is what we want. We want to see all these queues disappear.’’

Meanwhile, petrol marketers at various stations visited lamented that lack of supply and in adequate supply of petroleum products from the Nigerian National Petroleum Corporation, NNPC, in recent time , resulted in product scarcity being witnessed across the country.

Manager of Oando Filling station, Zone 4, who identified himself as Isa Friday, disclosed that it had been long the station got supply from NNPC depot at Suleja. Also, the manager of Forte Oil, opposite Transcorp Hilton in Maitama District, said only three fuel tankers were being supplied daily now, against the previous five or six.

NNPC calls for calm

Meanwhile, the Nigerian National Petroleum Corporation, NNPC, said yesterday  it empathized with the difficulties Nigerians were going through due to the current fuel situation and assured that it and the government were not taking their patience for granted.

According to the Group General Manager, Public Affairs, Garba Deen Mohammed, Nigerians should continue to be patient because difficulties being experienced as a result of the situation will soon be alleviated.

He said: “We would like to assure all Nigerians that the Minister of State for Petroleum Resources/Group Managing Director of NNPC, Dr. Ibe Kachikwu, and everybody else associated with this situation are working round the clock to ensure relief is brought to Nigerians.

“Our immediate concern is to make petrol available through the interventions and processes put in place so that the queues will disappear within the next one to two weeks. We have enough products lined up to ensure that the supply gap which created the problem is bridged.

“In order to ensure effective distribution, we are working with Independent Petroleum Marketers Association of Nigeria (IPMAN), oil majors and over 1,000 NNPC staff nationwide to ensure we overcome the obstacles in the distribution of the products.

“While not resorting to excuses, we would like to re-emphasize that the present management of NNPC and, indeed, the government inherited huge and complicated problems with respect to importation, distribution and pricing of petroleum products.

“Nigerians would recall that ₦522,258,934,505 meant for payment of fuel subsidy, covering the last quarter of 2014 (October to December) and the entire 2015 was approved by the Senate in December 2015 in order to pay for subsidy arrears inherited by this government.

“For long term solutions, the NNPC and the government are working to put in place machineries to ensure that our refineries are fixed and working optimally, while the pipelines which have been under attack for some time now are repaired.

“The Direct Sale Direct Purchase (DSDP) arrangement for crude would commence in the first week of April and all these, coupled with the fact that the President has given his support to increase the crude supply to NNPC to ensure local sufficiency of products, will go a long way to solve the problems in the short and long term.”