BY CLARA NWACHUKWU

Another crisis is brewing in the downstream petroleum sector, as oil marketers and truck owners differ on the modalities for paying a 45 percent increase in freight approved by government effective from March 1, 2011.

Already, long queues have resurfaced in Abuja, its environs and Kaduna, as members of the National Association of Road Transport Owners, NARTO, adamantly refuse to lift fuel for some members of the Major Oil Marketers Association of Nigeria, MOMAN, until they have paid the new sum, which translates to N3.76 per litre of petrol and kerosene.

Specifically, NARTO is refusing to lift petroleum products for African Petroleum Plc and Oando Plc, but will eventually trickle down to the rest of the oil marketers nationwide, as none has begun paying the new rate.

In a quick intervention with a view to resolving the impasses, the Petroleum Products Pricing Regulatory Agency, in charge of regulating pricing in the downstream, has summoned stakeholders to a meeting in Abuja last week Wednesday.

Those expected to attend the invited for the meeting are the Federal Ministry of Finance, which is expected to pay the differential in the new freight rate; the Nigerian National Petroleum Corporation, NNPC; and the Petroleum Equalisation Fund, PEF, the administrator of freight funds, all representing Federal Government’s interests.

While members of MOMAN; NARTO; the Independent Petroleum Marketers Association of Nigeria, IPMAN; Deport and Petroleum Products Marketers Association, DAPPMA; and the Jetty and Petroleum Tank Farm Operators of Nigeria, JEPTFON are equally to represent operators’ interests at the meeting.

Ahead of the meeting scheduled to hold at 2p.m. Nigerian time at the PPPRA Headquarters in Abuja, MOMAN, insist that its members do not have the resources to pay the additional N3.76/L. Rather, it urged government, through the Ministry of Finance to pay the transporters themselves.

Addressing journalists on some of the contending issues, the Executive Secretary, MOMAN, Mr Obafemi Olawore, noted that government unilaterally decided to hike freight rates for NARTO without discussing the modalities for its payment with other operators.

As it stands, he argues that government is left with the options of either increasing or decreasing the pump prices of petrol and kerosene, which are regulated at N65/L and N50/L respectively.

He recalled that the new rate was approved “during the peak period of the general elections when NARTO threatened to go on strike if the freight rate was not increased, and government agreed to increase it by 45 percent and also backdated it to take effect from March 1.

“But government failed to do two things it did not increase the open market price (pump price) or reduce it, and as such, the new rate was not reflected in the PPPRA Pricing Template and marketers could not pay.

“Government said the differential will be paid by the Federal Ministry of Finance … we wrote them (PPPRA) severally on the cumbersome nature of the implementation and we did not receive any response until we were summoned for a meeting late Monday night for a meeting in Abuja tomorrow.”

Olawore argued that if government and the industry regulators had been proactive enough, the current impasse would have been averted.