By Daniel Eteghe
The Federal Government will soon summon fuel marketers in the aviation industry to a meeting over the rising cost of aviation fuel otherwise known as Jet-A1 which has continued to put pressure on domestic airline operators operating in the country.
Director-General, Nigerian Civil Aviation Authority (NCAA), Dr. Harold Demuren disclosed this while briefing journalists on the Federal Aviation Administration’s (FAA) emergency airworthiness directive on Boeing 737-300 series airplanes.
As a result of the high cost of the commodity in the country, both local and international airlines prefer to refuel in neighbouring countries like Ghana, Togo and elsewhere, thereby depriving the country of huge business. The product sells for N160 per litre from N98 it hitherto sold for.
He said that while marketers have raised prices of their products over time, the carriers have only marginally increased air fares, saying, “we cannot operate that way.”
Describing the situation as ridiculous, the NCAA boss affirmed that there are lots of loopholes in the process of supplying the product which need to be addressed adding that the airlines cannot continue to groan under the weight of the oil price.
He said: “The price of aviation fuel in Nigeria is ridiculous; too high. We need to knock this down. We are working on it and I believe we will be able to do this. We can’t continue this way.”
Demuren added that “There are a lot of loopholes that we are trying to close right now. We are talking with the government, the third meeting we have with the fuel marketers will be major because everybody will be present”, he added.
“Aviation business is not a gold mine. A lot of people who come to this industry feel it is a gold mine. The rate of return on investment in aviation is about two to three per cent for the airlines or even manufacturers.
Most of the cash flow you see belongs to fuel marketers, maintenance organisations, training facilities and they have to pay lease rental, only little belongs to the airlines,” he said.
He said the only way the government can assist domestic airline operators in the country to thrive is to reduce their operating cost in order to ensure that they operate profitably.
“The only way we can help our airlines is for us to lower the operating cost, at the end of the day it is volume that matters. We must also give a lot of incentives to ensure that they can operate profitably.