*Oil hits 12-week high

By Victor Ahiuma-Young & Daniel Alfred

LAGOS— CONTROVERSIES trailing the Petroleum  Products Pricing Regulatory Agency, PPPRA, took a new twist, yesterday, with the oil sector union, the National Union of Petroleum and Natural Gas Workers, NUPENG, calling for immediate overhauling of the agency.

NUPENG also accused the agency of  allocating petroleum products to portfolio businessmen masquerading as marketers.

Meanwhile crude oil prices hit a 12-week high, bracing $80 dollars a barrel, yesterday, as robust corporate earnings fueled optimism over the strength of the global economic recovery and the outlook for energy demand.

President of NUPENG, Comrade Igwe Achese, at a news briefing, alleged that there was no transparency in the 2010 second and third quarters allocations of petroleum products importation. He declared that the allocations were done without the knowledge of the board members including himself, stressing that a cabal was bent on throwing the downstream sector into chaos. 

Achese stressed that for the downstream of the oil and gas industry to enjoy peace and industrial harmony, “the Federal Government, through the Ministry of Petroleum Resources should cause the PPPRA to publish the list of the second and third quarters for the public.”

He added: “Allocation for imports must be given to operators in the downstream with required capacities and duly approved by the Department of Petroleum Resources, DPR, in accordance with local content bill. The PPPRA should be supervised by the Nigeria National Petroleum Corporation, NNPC, and Ministry of Petroleum Resources.”

Comrade Achese said the Agency had lost its economic relevance, noting that a panel of inquiry should be instituted to probe its excesses.

He also said that the Ministry of Finance should bail-out core downstream oil companies with visible investments as they did to the banks, agriculture, textile manufacturers, aviation, etc. the Achese urged the government to negotiate with Jetty and Petroleum Tank Farm Owners of Nigeria, JEPTFON, on the way forward for the downstream sector, noting that transparency must be instituted as a way out in the future allocations.

The union threatened that if the government failed to act on their demands and recommendations, it would be compelled to join the grievance with its ultimatum to the government which would expire this week.

The NUPENG boss, also alleged that when the second quarter allocation was made, he asked for  explanation on why the allocation was done without the knowledge of the board members. According to him, the secretary said it was based on the Minister of State Petroleum’s directive, adding that despite the assurance that such would not be repeated, the third quarter imports allocation was also done without the knowledge of board members, while most of the known marketers with adequate storage facilities and tank farms were excluded.

Achese said the few marketer who were given were allocated far bellow their request, stressing: “Those who asked for example, 30,000 metric tons were allocated 300 metric tonnes while those who asked for 300 metric tonnes were allocated 30,000 or more metric tons. We are board members, we want to know why. Nobody can be cowed into this decision making that lacks transparency and which will not move the sector forward.

“As you are aware, Jetty and Petroleum Tank Farm Owners of Nigeria, JEPTFON, is now a branch of NUPENG. The alliance agreement between JEPTFON and NUPENG was signed recently. Be that as it may, we received a protest from JEPTFON on the underhand and scandalous petroleum allocation by the Petroleum Products Pricing Regulatory Agency, PPPRA, in the second and third quarters of 2010. We want to point out that it is a drain on the resources of our great country for PPPRA to allocate petroleum products to portfolio holding businessmen that masquerade themselves as oil and gas sheikhs and worst of all in the case of those companies whose oil and gas depots are in bad shape that use such depots as ploys to milk the economy dry.”

Oil hits 12-week high

Meanwhile, European stock markets hit a three-month high as risk appetite across commodity and financial markets picked up following strong results from leading banks HSBC.

The United States’ September crude rose 93 cents to $79.88 a barrel by yesterday morning, just off the intra-day peak of $79.90, the highest price since May 6.

ICE Brent earlier rose $1.09 to $79.27, the highest level since June 21. The U.S. dollar fell against a basket of currencies.