By Clara NWACHUKWU
The Chairman, House of Representative Committee on Petroleum Resources (Downstream), Hon. Dakuku Peterside, has observed that the private sector holds the key to the effective harnessing and utilisation of the nation’s hydrocarbon resources for overall economic growth.

Peterside, who made the observation when he led his committee members on an inspection tour of some oil facilities in Lagos, also commended the high level of competence exhibited by private firms in the industry, which he described as quite impressive.

While on the facilities tour, as part of the lawmakers’ oversight function on the downstream sector, the committee visited a number of places including the Department of Petroleum Resources, DPR, Federal Government/Nigerian National Petroleum Corporation, NNPC assets as well as some private depots and tank farm operators.

As a result, the lawmakers’ initial assessment was that the private facilities were more better managed and maintained than the government owned ones, for which Peterside promised that the committee will make recommendations on how to hand over some of these assets to the private sector.

Technology for people

At the DPR, the Director, Mr. Osten Olorunshola spoke about the dearth of capacity and constraints to employ new hands, leaving the industry regulator with the option of investing heavily in technology.

“Since we don’t have all the people we need and we cannot be everywhere at the same time, we have invested a lot in equipment so that from our offices we can monitor what is happening outside, where we don’t have our men. That is why we made substantial provisions in the 2012 budget for manpower development and technology to make up for the shortfalls,” he explained.

Other challenges

The DPR boss cited other challenges weighing down on the operations of the regulator to include inadequate funding, dearth of facilities, bureaucratic bottlenecks and political interference and a host of many others.

With regard to, he argued that the agency is grossly underfunded to meet the demands and challenges of the industry, saying, “Funding is a very serious issue; because government’s resources are limited, the department has not been sufficiently funded compared with its peers in countries like Brazil, Norway, and Malaysia and the rest. We are far behind them, and if we must up our games, then there is the need to fund the agency appropriately.”

Ejigbo depot challenges

The Depot Manager at the NNPC’s Ejigbo Satellite Depot, Mr Kevin Ekeh, told the legislators that the 13 million litre capacity depot is weighed down by a number of challenges. These include low storage capacity; products shortages particularly for automotive gas oil, AGO or diesel and Dual Purpose Kerosene, DPK; pipeline vandalism; decaying and poor infrastructure with water seeping into the storage tanks; urbanisation and a host of many others.

As a result, he said the depot, which could load up to 120 trucks a day as at April end, is now loading just about 60 to 65 trucks daily.

This, he explained is because three out of the 10 loading arms in the depot are out of service, coupled with the fact that “the depot is a mono product depot as it deals with only one product – premium motor spirit, PMS or petrol. For over 10 years now, there has not been AGO or DPK in the depot.”

Consequently, the depot manager said the facility has witnessed the loss of many of its customers including both the major and independent marketers, who now preferred to go to the Apapa depot to load their products.

Ekeh argued that in view of its size, the Ejigbo depot could do with additional storage tanks to increase products stock, as the depot is now run on a day-to-day basis due to leakages in some of the tanks. “If there is any failure in stock, there will be problems because the depot will run out of stock,” he warned.

Nipco Terminal

In contrast, the legislators expressed satisfaction with the successes made by private operators, such as Nipco Plc, saying that this gives a lot of hope in achieving meaningful development in this very strategic sector.

He maintained that from what his committee saw at the organisation’s terminal, Nigeria can boast of a world class company capable of taking the country to greater heights in no distant future.

He argued that Nipco represented hope in indigenous business ingenuity, which Nigeria and Nigerians can be proud of even as he expressed optimism that the firm will keep the flag flying at all times.

He said his committee will continue to support the company and others that have shown exemplary competences in the overall interest of the industry.

Peterside pointed out that they will ensure that Nigerians received the best service in terms of petroleum products, price, quality and access in a manner that will make us comparable to other oil rich nations of the world.

He promised that his committee will also address the issue of safety in all ramifications in the industry with a view to ensuring that the nation operates within the ambit of international best practices in this very important sector of the national economy.

In his remarks, the Executive Director, Corporate, Alhaji Abdulkadir Aminu, revealed that Nipco emerged as one of the beneficiaries of the deregulation of the oil and gas industry of the Nigerian economy.

He noted that the company, which began operation in 2004, with 60 million litres white products storage capacity, is now a reference point in the history of petroleum products storage and distribution in Nigeria.

Aminu explained that Nipco, which is a partnership between Independent Petroleum Marketers, IPMAN, and a core investor – Pure Bond limited UK, is deeply committed to providing Nigeria and Nigerians outstanding services in the nation’s most strategic industry.

“Having chosen to represent Nigerians in the downstream of this essential industry, we have immense responsibility to prove to our stakeholders, the entire nation and the world that Nigerians are fit and capable of running world class corporations for our own benefits and that of the world,” he said.

Aminu argued that in less than a decade of the company’s operations, the firm has come of age, having attained remarkable landmarks in the oil and gas industry.

He said one of such achievements is the pioneering efforts in the use and construction of Compressed Natural Gas, CNG stations to encourage the use of CNG powered vehicules in the country.

Legislative oversight

The Chairman of the House Committee, Hon. Dakuku Peterside, who led the delegation, expressed the legislators’ dismay over the indiscriminate construction of petroleum assets such as depots, retail outlets and a host of others around residential.

He noted that these have serious and attendant health, safety and environment issues associated with such unguarded operations, particularly in Lagos, where they visited a number of petroleum facilities including the Atlas Cove Jetty, and some petroleum depots in Ibafon, Apapa.

The lawmakers, therefore, urged the DPR to take a second look at issues such as the siting of fuel stations in residential areas; pipelines vandalism, which they referred to as operational terrorism; indiscriminate location of tank farms; products adulteration; the menace of unfit petroleum trucks, and a host of many others for which the committee had received a legion of complaints from Nigerians.

Visit to Lagos

Peterside earlier explained that his committee was in Lagos, as part of its oversight functions over agencies, ministries, departments and parastatals, adding that this was the committee’s first visit outside Abuja.

“We chose to visit Lagos first because Lagos holds about 40 percent of key petroleum assets in the country. Also, in terms of consumption of these petroleum products, Lagos also tops the chart, and the industry regulator is also located in Lagos,” he added.

Areas of concern

Specifically, he said the legislators were not impressed with how the Federal Government was handling the Atlas Cove Jetty, Nigeria’s biggest petroleum products reception terminal.

He also said the committee was equally worried that the nation’s traditional refineries cannot still cope with domestic consumption needs.