Abdul Lawal
The wagging tongues on the actual volume of refined petroleum products consumption level otherwise known as Premium Motor Spirit (PMS) in Nigeria may live with us for a long time as a lack of accurate data in the downstream petroleum distribution activities reign in the sector.
A senior Petroleum Engineer and member Society Of Petroleum Engineers (SPE) in a chat with DailyNewscraft, ng said each player in the sector generates data that are not well coordinated by regulatory authorities in the industry.
The Engineer who worked with an Oil and Gas service company and spoke on the ground of anonymity said you see figures flying everywhere depending on which of the company or agencies that you are relating with.
He noted that though Nigerian National Petroleum Company Limited (NNPC ) Limited is now at the heart of fuel importation into the country but the channels of distribution through the depots are numerous and not coordinated.
According to him, NNPC Limited has over 21 fuel depots across the country but right now over 80 percent of the depots are not functioning hence trucking of fuel on long distances which compounds accurate collation of data on fuel distribution and by extension fuel consumption in the country.
This position has given rise the recent disagreement between NNPC Limited and the Nigeria Customs Service on the actual PMS consumption level in the country.
NNPC Limited had claimed that daily PMS consumption in the country hovers around 60 million liters per day out of 98million liters lifted at various depots across the country leaving 38 million liters in the hand of smugglers.
The Comptroller General, Nigerian Customs Service (NCS), Col. Hameed Ali (Rtd) while appearing before the House of Representatives Committee on Finance, alleged that NNPC Limited was supplying an excess of 38 million liters of petrol daily since 98 million liters were lifted daily from the depots.
Arguing his position on the issue, Ali said: “If I am operating a fuel station today and I go to Minna depot, lift petrol and take it to Kaduna, I may get to Kaduna in the evening and offload that fuel. There is no way I would have sold off that petrol immediately to warrant another load, “So, how did you get to 60 million liters per day? That is my question. According to him, on the issue of smuggling, ´ if you release 98 million liters in actual and 60million liters are used, the balance should be 38 million liters. How many trucks will carry 38million liters every day? Which road are they following and where are they carrying this thing to?”
*But reacting to Ali’s position, the NNPC Limited had maintained that between January and August 2022, the total volume of PMS imported into the country was 16.46 billion liters, which translated to an average supply of 68 million liters in a day however this position didn’t tackle the issue raised by Customs boss Ali on extra 38million liters raised at the hearing.
The Comptroller General also faulted claims by NNPC Limited that over N6.34trillion subsidy payments are made as fuel subsidy yearly.
According to NNPC Limited statement signed by its Group General Manager, Group Public Affairs, Mr. Garba Deen Mohammed in Abuja stated that “ The NNPC Ltd notes the average daily evacuation (Depots Truck out) from January to August 2022 stands at 67million liters per day as reported by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA). Daily Evacuation (depot load outs) records of the NMDPRA do carry daily oscillation ranging from as low a withdrawal of 4 million liters to as high as 100 million liters per day”
“ Rising crude oil prices and PMS supply costs above PPPRA( now NMDPRA) cap had forced oil marketing companies (OMCs) withdrawal from PMs import since the fourth quarter of 2017” he stated
“In the light of these challenges, NNPC has remained the supplier of last resort and contuse to transparently report the monthly PMS cost under-recoveries to the relevant authorities”. The statement added.
According to Mohammed, the average Q2, 2022 International market determined landing cost was US$1,283/MT and the approved marketing and distribution cost of A-46/liter.
“NNPC Limited shall continue to ensure compliance with an existing governance framework that requires the participation of relevant government agencies in all PMS discharge operations, including Nigerian Ports Authority, Nigerian Navy, Nigeria Customs Service, NIMASA, and all others”
Further NNPC Limited admitted that it” recognizes the impact of maritime and cross border smuggling of PMS on the overall supply framework.NNPC also acknowledged the possibilities of other criminal activities in the PMS supply and distribution value chain.
“As a responsible business entity, NNPC Limited will continue to engage and work with relevant agencies of the government to curtail smuggling of PMS and contain any other criminal activities”
The NNPC however stated that Premium Motor Spirit (PMS) will cost consumers N462 per liter without the Federal Government subsidy.