By Clara Nwachukwu
LAGOS – Some depots used for storing refined petroleum products have remained shut due to fear of being attacked by angry mobs in protest against the removal of subsidy from petrol.
Vanguard investigations showed that most petroleum depots were shut down, leaving only a handful loading petrol among those operating in Lagos.
Loading schedule exclusively obtained by Vanguard showed that those that loaded petrol included: Lister Oils Limited, with ex-depot price at N132/litre; Capital Oil and Gas for NNPC/PPMC 128/L; Folawiyo Petroleum Company Ltd N132/L; MRS Apapa N130/L; NIPCP Plc N130/L and Techno Oil Ltd N131.66/L.
Most of these depots are under throughput arrangement, through which they store products for companies for a fee not less than N3 million per month.
The Department of Petroleum Resources, DPR, sources said they had not sealed any depot for hoarding due to “the precarious situation because we want to encourage many of them as possible to keep loading in order to avert scarcity.”
Meanwhile, despite criticisms that the industry regulator was unable to sanction as many marketers as anticipated for selling above the maximum benchmark price prescribed by the Petroleum Products Pricing Regulatory Agency, PPPRA, Director, DPR, Mr. Osten Olurunshola, said the agency was doing its best, considering that the Tuesday mob had prevented officials from performing their duties in some areas in Lagos.
“In a text response to Vanguard enquiry, Olurunshola wrote: “There were several areas monitored today. There were also a few, which we needed to reinforce with security before we could reach them. Others will continue.”
“But note that the safety and security is paramount. All those not complying with the agreed price benchmarks are being sealed off.”
Contrary to their earlier excitement, oil marketers operating in the downstream sector of the Petroleum industry have expressed dissatisfaction with the current market structure.
Arising from a stakeholders meeting in Abuja on Tuesday with the PPPRA, which announced the subsidy removal on New Year’s day, the marketers declared: “The system we have now is not deregulation but subsidy removal.”
Some of the oil marketers who attended the meeting told Vanguard in confidence: “Other than the change in price, nothing has changed in the pricing template. They just kept everything the way they wanted.”
The meeting, which ended in stalemate, suggested that the Federal Government had not done its home work well before embarking on the contentious subsidy removal, as those who are supposed to benefit from the system are also complaining, and by extension that the benefits of the subsidy removal may take longer than anticipated.
The marketers also wondered, “Where in the world do you see a deregulated regime where there is a price benchmark. Look at the PPPR’s template, other than petrol; where else do you have a benchmark price? Deregulation means subjecting price to market forces. That is how it has worked with the other products – diesel, LPFO (black oil), aviation fuel, so why should petrol be different?”
In view of the marketers’ anger, those who spoke to Vanguard refused to give further details on what transpired at the meeting.
Industry regulators unable to control situation
Multiple calls and text messages to the PPPRA’s Executive Secretary, Mr. Stanley Reginald; and the agency’s spokesperson, Dr. Wole Adamolekun, regarding the outcome of the meeting and other bottlenecks facing the subsidy removal were not responded to.
In particular, the PPPRA, could not also response to the issue of logistics glitches, as the fuel metres currently in use cannot sell beyond N9,500. This means that any motorist, wishing to fill his/her tank above 60 litres, would have to do so in two separate transactions, as the metering system cannot go beyond six digits.
This was described by DPR and NNPC, as “Some of the teething problems we will overcome very soon.”