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Nigeria’s Fuel crisis defies solution

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ABUJA — THE perennial fuel crisis which has blighted the year worsened across the country, weekend, as hundreds of motorists slept in petrol stations with the intention of purchasing the products.

This was even as the Federal Government, yesterday, directed the Pipelines and Products Marketing Company, PPMC, and the Petroleum Products Pricing Regulatory Agency, PPPRA , to commence a special supply intervention  measures to bring an end to the perennial fuel scarcity witnessed across the country.

This intervention, according to the Minister of State for Petroleum Resources and Group Managing Director of Nigerian National Petroleum Corporation, NNPC, Dr. Ibe Kachikwu,  is to ensure a country-wide availability of petroleum products ahead of the forthcoming yuletide and beyond.

To this end, the NNPC, in a statement in Abuja, noted that  the Kaduna Refinery and Petrochemical Company resumed operation over the weekend while the intervention was kick-started with the ramping  up of additional supply via massive truck-out to guarantee product penetration to the nooks and crannies of the country.

According to the NNPC, daily fuel truck out to locations such as Abuja, Kaduna, Kano, Enugu, Ibadan and Jos has been increased significantly to enhance free flow of products across the country.

The NNPC stated that it was consolidating its strategic alliance with some major depot owners and oil marketers with strong regional logistics outlay in those areas to ensure maximum infiltration of products especially in the hinterland ahead of the forthcoming Christmas and New Year festivities.

Warns against diversion, hoarding

Long queue of jerry cans at a petrol station as fuel scarcity bites harder, yesterday. Photo: Joe Akintola, Photo Editor.

While calling on members of the public to refrain from hoarding, product diversion and panic buying of petrol, the NNPC noted that the intervention measure would help circumvent the challenges posed by the unavailability of pipelines for the transportation of petroleum products.

It warned that product diversion is an economic crime and stated that it would not hesitate to report offenders to the security agencies for prosecution.

Despite the claims by the NNPC, the scarcity increased in intensity, Wednesday, few days after the Federal Government announced that it had paid oil marketers their outstanding subsidy claims, and it showed no sign of abating.

Scarcity persists

One motorist who spoke to Vanguard, disclosed that despite the fact that he came to the petrol station by 2 am, he couldn’t get the product to buy at the NNPC Mega Station at Katampe, along the Kubwa Expressway, till around noon.

Another motorist said he joined the queue 5 am on Sunday, but couldn’t get fuel to buy until 4 pm.

When Vanguard visited petrol stations along the Kubwa Expressway by 5am, vehicles were parked in front of the MRS, Mobil, Conoil, Total and Bulasawa filling stations, despite the fact that they were yet to commence business for the day.

Only the NNPC Mega Station was selling with queues stretching several kilometres and a chaotic situation.

To worsen matters, security personnel stationed at the entrance to the petrol stations to maintain orderliness were seen fuelling disordeliness. The security personnel allowed motorists who had paid them between N500 and N1,000, to enter through the exit gate, forcing other orderly motorists to spend several hours on the queue.

Same situation was witnessed in some petrol stations at the Central Business Districts, as some motorists claimed they had to leave their houses as early as 3am to join the queue.

As a result of the fuel crisis, transport companies hiked their fares, thereby, worsening the plight of commuters.

ABC Transport Company at Utako, for instance, hiked its fare from Abuja to Enugu to N6,000, weekend, from N4,500 earlier in the week.

Same situation was recorded in other transport companies heading to the south eastern part of the country, specifically, forcing people travelling for the Christmas holiday to incur additional costs.

Scarcity nationwide

Osun: The effect of fuel situation in Osun State worsened over the weekend as most filling stations sold their products between N140 and N150 per litre. The situation was not made better as the NNPC mega station which sold its petrol product at normal price of N87 per litre had no supply.  Similarly, transporters who are on inter-state routes have subsequently increased their fare by about 25 per cent.

Kwara: The fuel situation in Kwara, particularly Ilorin, the state capital was worrisome as virtually all the fuel stations have remained under permanent lock for sometime now, except OANDO along Murtala and NNPC along Offa Garage Road and Asa Dam Road which dispense the products whenever they have.

As a result of this development, many motorists have now resorted to buying fuel in the nearby Ogbomosho, about 30 minutes drive where petrol was  available at N140 per litre.

Anambra:  Despite the availability of petroleum products in most filling stations in Anambra State, the prize has continued to hover between N115 and N130 per litre.

NNPC mega station in Awka, which is the only station selling at the official price of N87 per litre,  does not sell regularly. Whenever there is fuel at the mega station, the queues are unusually long as many people would want to fill their vehicles at that rate.

Other stations with NNPC signs and the multinational companies have not been selling fuel to the public since the prize went up, as there were allegations that they prefer to sell to the independent markers wholesale who, in turn, were freer to sell at whatever rate they liked.

Unlike last week when many stations did not have fuel, almost all stations along the Awka–Onitsha-Owerri axis had fuel yesterday and there were no queues whatsoever.

Some of the fuel attendants said they were still trying to finish the fuel they lifted at very high rate before adjusting their pumps to the normal prize.

It was, however, discovered that some of the stations that were not selling when the prize was high have bought products, but were still claiming that they bought them at exorbitant rates.

Bayelsa: Petrol is relatively scarce in the predominantly riverine state. A litre is sold between N130 and N150 in filling stations across the state where the product is available.

This explained the daily long queue at the NNPC mega station along Sani Abacha express road in the heart of Yenagoa where a litre is sold at N87.

Motorists preferred the NNPC station to the other retail outlets in town regardless of the inconveniences in buying the product.

The NNPC mega station pumps are believed to be dispensing the actual fuel paid for as against the other retail outlets which pumps have been tampered with and are under dispensing to buyers.

Ogun:  Many filling stations in the state locked their gates while the few that opened sell above the pump price at between N120 and N140 while only NNPC  stations and MRS sell at N87 .

Following the scarcity of fuel in Abeokuta, the state capital and some other parts of the state, which include Ijebu-Ode,  Ilaro among others,  most commercial  vehicles charged exorbitant prices.

Abia: Fuel scarcity persists in the state as most petrol stations have remained closed while the few that have products dispense at between N125 and N140 per litre. However, the NNPC Mega station on Enugu-Port Harcourt express road has been selling at N87 per litre though there are always long queues.

Oyo: Long and endless queues at filling stations which had subsided for a week have now returned. Premium Motor Spirit is sold for as much as N125 by some independent marketers while most major marketers shut their stations for lack of supply.

In Sabo area of the city, black market goes on unhindered as under age boys stand by the road sides with kegs of petroleum products.

Rivers:  Black market operators dealing on petrol are still making brisk business in Port Harcourt, capital of Rivers State and adjourning local government areas because of scarcity of the product.

Most filling stations did not have product, the few that were selling dispensed to motorists at between N140 and N160 per litre. There were long queues at few filling stations of major marketers selling at N87 per litre.  Commercial bus operators  were still charging twice the fares for some routes because of the scarcity.

By Michael Eboh

ABUJA — The perennial fuel crisis which has blighted the year worsened across the country, weekend, as hundreds of motorists slept in petrol stations with the intention of purchasing the products.

This was even as the Federal Government, yesterday, directed the Pipelines and Products Marketing Company, PPMC, and the Petroleum Products Pricing Regulatory Agency, PPPRA , to commence a special supply intervention  measures to bring an end to the perennial fuel scarcity witnessed across the country.

This intervention, according to the Minister of State for Petroleum Resources and Group Managing Director of Nigerian National Petroleum Corporation, NNPC, Dr. Ibe Kachikwu,  is to ensure a country-wide availability of petroleum products ahead of the forthcoming yuletide and beyond.

To this end, the NNPC, in a statement in Abuja, noted that  the Kaduna Refinery and Petrochemical Company resumed operation over the weekend while the intervention was kick-started with the ramping  up of additional supply via massive truck-out to guarantee product penetration to the nooks and crannies of the country.

According to the NNPC, daily fuel truck out to locations such as Abuja, Kaduna, Kano, Enugu, Ibadan and Jos has been increased significantly to enhance free flow of products across the country.

The NNPC stated that it was consolidating its strategic alliance with some major depot owners and oil marketers with strong regional logistics outlay in those areas to ensure maximum infiltration of products especially in the hinterland ahead of the forthcoming Christmas and New Year festivities.

Warns against diversion, hoarding

Long queue of jerry cans at a petrol station as fuel scarcity bites harder, yesterday. Photo: Joe Akintola, Photo Editor.

While calling on members of the public to refrain from hoarding, product diversion and panic buying of petrol, the NNPC noted that the intervention measure would help circumvent the challenges posed by the unavailability of pipelines for the transportation of petroleum products.

It warned that product diversion is an economic crime and stated that it would not hesitate to report offenders to the security agencies for prosecution.

Despite the claims by the NNPC, the scarcity increased in intensity, Wednesday, few days after the Federal Government announced that it had paid oil marketers their outstanding subsidy claims, and it showed no sign of abating.

Scarcity persists

One motorist who spoke to Vanguard, disclosed that despite the fact that he came to the petrol station by 2 am, he couldn’t get the product to buy at the NNPC Mega Station at Katampe, along the Kubwa Expressway, till around noon.

Another motorist said he joined the queue 5 am on Sunday, but couldn’t get fuel to buy until 4 pm.

When Vanguard visited petrol stations along the Kubwa Expressway by 5am, vehicles were parked in front of the MRS, Mobil, Conoil, Total and Bulasawa filling stations, despite the fact that they were yet to commence business for the day.

Only the NNPC Mega Station was selling with queues stretching several kilometres and a chaotic situation.

To worsen matters, security personnel stationed at the entrance to the petrol stations to maintain orderliness were seen fuelling disordeliness. The security personnel allowed motorists who had paid them between N500 and N1,000, to enter through the exit gate, forcing other orderly motorists to spend several hours on the queue.

Same situation was witnessed in some petrol stations at the Central Business Districts, as some motorists claimed they had to leave their houses as early as 3am to join the queue.

As a result of the fuel crisis, transport companies hiked their fares, thereby, worsening the plight of commuters.

ABC Transport C ompany at Utako, for instance, hiked its fare from Abuja to Enugu to N6,000, weekend, from N4,500 earlier in the week.

Same situation was recorded in other transport companies heading to the south eastern part of the country, specifically, forcing people travelling for the Christmas holiday to incur additional costs.

Scarcity nationwide

Osun: The effect of fuel situation in Osun State worsened over the weekend as most filling stations sold their products between N140 and N150 per litre. The situation was not made better as the NNPC mega station which sold its petrol product at normal price of N87 per litre had no supply.  Similarly, transporters who are on inter-state routes have subsequently increased their fare by about 25 per cent.

Kwara: The fuel situation in Kwara, particularly Ilorin, the state capital was worrisome as virtually all the fuel stations have remained under permanent lock for sometime now, except OANDO along Murtala and NNPC along Offa Garage Road and Asa Dam Road which dispense the products whenever they have.

As a result of this development,many motorists have now resorted to buying fuel in the nearby Ogbomosho, about 30 minutes drive where petrol was  available at N140 per litre.

Anambra:  Despite the availability of petroleum products in most filling stations in Anambra State, the prize has continued to hover between N115 and N130 per litre.

NNPC mega station in Awka, which is the only station selling at the official price of N87 per litre,  does not sell regularly. Whenever there is fuel at the mega station, the queues are unusually long as many people would want to fill their vehicles at that rate.

Other stations with NNPC signs and the multinational companies have not been selling fuel to the public since the prize went up, as there were allegations that they prefer to sell to the independent markers wholesale who, in turn, were freer to sell at whatever rate they liked.

Unlike last week when many stations did not have fuel, almost all stations along the Awka–Onitsha-Owerri axis had fuel yesterday and there were no queues whatsoever.

Some of the fuel attendants said they were still trying to finish the fuel they lifted at very high rate before adjusting their pumps to the normal prize.

It was, however, discovered that some of the stations that were not selling when the prize was high have bought products, but were still claiming that they bought them at exorbitant rates.

Bayelsa: Petrol is relatively scarce in the predominantly riverine state. A litre is sold between N130 and N150 in filling stations across the state where the product is available.

This explained the daily long queue at the NNPC mega station along Sani Abacha express road in the heart of Yenagoa where a litre is sold at N87.

Motorists preferred the NNPC station to the other retail outlets in town regardless of the inconveniences in buying the product.

The NNPC mega station pumps are believed to be dispensing the actual fuel paid for as against the other retail outlets which pumps have been tampered with and are under dispensing to buyers.

Ogun:  Many filling stations in the state locked their gates while the few that opened sell above the pump price at between N120 and N140 while only NNPC  stations and MRS sell at N87 .

Following the scarcity of fuel in Abeokuta, the state capital and some other parts of the state, which include Ijebu-Ode,  Ilaro among others,  most commercial  vehicles charged exorbitant prices.

Abia: Fuel scarcity persists in the state as most petrol stations have remained closed while the few that have products dispense at between N125 and N140 per litre. However, the NNPC Mega station on Enugu-Port Harcourt express road has been selling at N87 per litre though there are always long queues.

Oyo: Long and endless queues at filling stations which had subsided for a week have now returned. Premium Motor Spirit is sold for as much as N125 by some independent marketers while most major marketers shut their stations for lack of supply.

In Sabo area of the city, black market goes on unhindered as under age boys stand by the road sides with kegs of petroleum products.

Rivers:  Black market operators dealing on petrol are still making brisk business in Port Harcourt, capital of Rivers State and adjourning local government areas because of scarcity of the product.

Most filling stations did not have product, the few that were selling dispensed to motorists at between N140 and N160 per litre. There were long queues at few filling stations of major marketers selling at N87 per litre.  Commercial bus operators  were still charging twice the fares for some routes because of the scarcity.

Vanguard-

 

 

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NNPC Discovers Over 4,800 Illegal Pipeline Connections

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The Nigerian National Petroleum Company (NNPC) Limited  has revealed the detection of more than 4,800 unauthorized connections on oil pipelines within the country, painting a troubling image of the nation’s primary source of revenue.

Mele Kyari, the Group Chief Executive Officer of NNPC Ltd, communicated this information to the Senate Committee on Appropriations last Friday.

He said, “We have over 4,800 illegal connections on our pipelines. That means in some lines, within 100 kilometres of pipelines, you have as much as 300 insertions.

“Therefore, even when you produce the oil, you cannot deliver them at the required pressure and therefore the volume will also be less.”

As per the NNPC Ltd chief, individuals from various regions enter the Niger Delta, inserting unauthorized connections on pipelines in Nigeria’s oil-producing area.

This recent revelation follows a prior discovery of 295 illegal connections to the pipelines by the firm a year ago, underscoring the escalating issue of crude oil theft in Nigeria.

Two years earlier, Kyari had highlighted the country’s daily loss of 200,000 barrels of oil, amounting to $13 million due to theft and vandalism.

He further stated “We have two sets of losses, one coming from our products and the other coming from crude oil. In terms of crude losses, it is still going on. On the average, we are losing 200,000 barrels of crude every day.”

After the discovery, Nigeria’s security forces pledged to enhance security around the country’s pipelines.

To bolster this, the Federal Government granted a multi-billion naira pipelines surveillance contract to Tantita Security Services, headed by former militant leader Government Ekpemepulo, also known as Tompolo.

Despite facing criticism for this decision, Senator Heineken Lokpobiri, the Minister of State for Petroleum, remains convinced that it was the appropriate course of action.

In August, following a tour of oil facilities in the Niger Delta, Senator Heineken Lokpobiri expressed gratitude to Tantita, commissioned by NNPC Ltd, for their ongoing work.

He also hinted at plans for further extensive endeavors in the future.

In 2021, after extensive debate and delays, the Petroleum Industry Bill was finally passed to attract increased foreign investment into the oil sector through amendments to regulations, royalties, and taxes.

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Dangote Refinery Set To Begin Fuel Production With First Crude Arrival

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Nigeria’s colossal $19 billion Dangote Refinery, after encountering several setbacks, is on the verge of kickstarting fuel production.

This achievement is heralded by the arrival of the first crude shipment, transported by the OTIS tanker carrying 950,000 barrels of Nigeria’s Agbami crude.

S&P Global, citing industry sources and tanker tracking data on spglobal.com, reported the tanker’s departure on December 6, en route to Lekki, the nearest land port to Dangote’s offshore crude receiving terminal.

Scheduled to reach its destination around 8 PM on December 7, the arrival of this shipment signifies the commencement of crude supplies for the refinery’s operations.

Chartered by the state-owned Nigerian National Petroleum Company (NNPC), the Suezmax tanker is an emblem of the initial crude supply to Dangote’s cutting-edge refinery, as disclosed by a West African oil trader familiar with the matter in the S&P report.

Even though the refinery was officially completed in May, the absence of domestic crude feedstock had hindered oil product manufacturing.

To address this, the NNPC, holding a 20% stake in the refinery, struck an agreement to provide 6 million barrels of crude oil as feedstock to the Dangote refinery in December.

This move aims to jumpstart operations and overcome the previous impediments.

Agbami, operated by Chevron, holds a prominent position among Nigeria’s major deepwater developments, producing around 100,000 barrels per day in the central Niger Delta.

Known for its light sweet crude qualities, with a specific gravity of 47.9 API and a low sulfur content of 0.04%, Agbami produces substantial amounts of naphtha and kerosene.

NNPC has chartered additional shipments from different Nigerian offshore fields to the refinery, marking the start of a sequence of planned crude supplies for the month, as mentioned by the oil trader.

Located on the outskirts of Lagos, Nigeria’s commercial hub, the Dangote Refinery encountered repeated delays since its 2013 announcement, despite significant installation progress in 2019.

The refinery, designed to handle multiple crudes simultaneously, targets three Nigerian crude grades—Escravos, Bonny Light, and Forcados. When operating at full capacity, it aims to produce 327,000 barrels per day (b/d) of gasoline, 244,000 b/d of gasoil/diesel, 56,000 b/d of jet fuel/kerosene, and 290,000 metric tons per year of propane/LPG.

Dangote’s operations starting signify Nigeria’s hopes to lessen its reliance on gasoline imports, addressing the deficiencies of its existing refineries undergoing repairs. This shift is poised to reshape Nigeria’s oil industry, potentially leading to gasoline self-sufficiency by the 2040s.

Dangote officials anticipate an initial output of 370,000 barrels per day (b/d), emphasizing jet fuel and diesel production.

Industry analysts, however, project the refinery to reach its full operational capacity by mid-2025, although potential delays remain a looming concern.

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NNPCL Sets Dec 2024 Terminal Date For Fuel Importation

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The Nigerian National Petroleum Company Limited (NNPCL) has announced intentions to cease importing refined petroleum products by December 2024, anticipating full operational functionality for all national refineries by that time.

Group CEO, NNPC Ltd, Mele Kyari, shared this at a meeting with Speaker Tajudeen Abbas of the House of Representatives, who advocated for the privatisation of Nigeria’s refineries on Thursday.

Projections indicated the national oil firm’s revenue could climb to N4.5 trillion by the conclusion of 2023. Moreover, the rehabilitation of the Port Harcourt Refining Company, managed by NNPCL, was slated for completion by December of the current year.

Meanwhile, Oil marketers verified on Thursday that the Port Harcourt refinery is set for operations, potentially starting in January 2024. They emphasized that once operational, this refinery could notably reduce the prices of refined petroleum products.

During the meeting in Abuja, Kyari asserted Nigeria’s intention to cease importing refined petroleum products by 2024, envisioning the country’s emergence as a net exporter of these commodities within the same year.

He outlined the plans for launching operations at the Port Harcourt, Warri, and Kaduna refineries.

Kyari reiterated that all refineries would operate at full capacity, ultimately paving the way for Nigeria to transition into a net exporter of petroleum products by the conclusion of 2024.

He attributed the inactivity of Nigeria’s refineries over the years to the petroleum subsidy, emphasizing that the removal of this subsidy was drawing significant private-sector investments into the sector.

Kyari said “I can confirm to you that by the end of December this year, we will start the Port Harcourt refinery; early in the first quarter of 2024, we will start the Warri refinery and by the end of 2024, Kaduna refinery will come into operation.

“This is the commitment we are giving today and you can hold us accountable for this. In 2024, many of the initiatives including the rehabilitation of our refineries and also the efforts of small-scale refineries, and the upcoming Dangote refinery, will make Nigeria a net exporter of petroleum products in 2024.

“We will no longer be talking about fuel importation by the end of 2024. I am very optimistic that this will crystallise.

Kyari promised that by the conclusion of 2023, the government’s anticipated revenue from the company would reach N4.5 trillion, emphasizing NNPCL’s adherence to the Petroleum Industry Act and its commitment to delivering value to shareholders.

Recall that in October 2023, it was reported that Nigeria’s monthly spending on the importation of Premium Motor Spirit, known as petrol, had reached approximately N843 billion due to NNPCL’s cessation of oil swaps.

In July of this year, the Nigerian Midstream and Downstream Petroleum Regulatory Authority reported that during the post-deregulation period, spanning June 1 to June 28, 2023, the country’s total petrol consumption amounted to 1.36 billion litres, with an average daily consumption of 48.43 million litres.

The average ex-depot price of petrol, sourced solely from NNPCL as the importer, stands at about N580 per litre.

However, both NNPCL and oil marketers declared on Thursday that this substantial oil import expenditure would soon diminish.

They anticipated a drop once the Port Harcourt refinery commences production of refined petroleum products from January 2024, barring any unforeseen circumstances.

 

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