Kerosene distribution: Depot, Jetty operators criticize exclusion …

NNPC releases 10,000\MT into market

By Clara Nwachukwu

Depot and Petroleum Products Marketers Association, DAPPMA, and the Jetty and Petroleum Tank Farm Operators of Nigeria, JEPTFON, have criticized their exclusion from the current supply and distribution system, being executed by the Nigerian National Petroleum Corporation, NNPC, to ease acute scarcity of the product in the market.

The independent depot and jetty operators rising from a crucial closed door meeting in Lagos, which lasted late into the night last week, noted that the supply and distribution challenges would persist, if they were not involved, seeing as they have bigger facilities to tackle the challenges.

The Chairman of DAPPMA, Chief Sylverius Okoli, who addressed journalists on behalf of the associations, noted that by choosing to deal with the Major Marketers Association of Nigeria, MOMAN, the NNPC had tacitly left out some regions in the country where the majors do not have presence to continue to suffer.

In a joint communiqué issued at the end of the meeting, the group emphasized that “Any attempt to restrict the distribution of DPK to MOMAN members only, will be a disaster because other excluded stakeholders control about 80 percent of infrastructure for efficient reception, storage and distribution of petroleum products.”

The NNPC and MOMAN last week, to end the scarcity and high cost of household kerosene within 10 days, as the NNPC promised to flood the market with the scarce commodity in order to make it both affordable and accessible.

But Okoli noted, “If you take us out, where we have 80 percent of the infrastructure, and we are spread all over the country and the whole west coast, then you are going to make the problem even worse.”

He argued that DAPPMA and JEPTFON equally want to be invited for discussions with the NNPC in order to proffer an all round solution to the supply and distribution of kerosene problems, while also calling for a level playing field for all participate.

“We do not know the criteria the NNPC adopted in selecting only MOMAN, but whatever the criteria, we are saying the GMD ought to involve all of us, particularly those who have the network and infrastructure to deal with the issues. We can all contribute to whatever the problem is and get a more rounded solution. But by excluding us, it is clear that the solution cannot be perfect,” he added.

The group expressed sadness with the scarcity of kerosene in the country, saying that this is largely “due to bottlenecks in supply and distribution caused by NNPC being the sole importer of DPK in the country.”

Consequently, the group condemned the recent guidelines on the product distribution, saying that this was done without input from all stakeholders, and in favour of only MOMAN.

“We, therefore, reject these new guideleines and request that the GMD NNPC, should immediately convene a meeting of all stakeholders to stipulate guidelines that will genuinely address the problems of supply and distribution of DPK across the nation in the interest of the common man.”

With regard to the 40 days sufficiency of the product the NNPC is claiming, Okoli noted that this will not have much impact if it does not trickle down to the final consumer.

According to him, “You can have 40 days sufficiency in the high seas, and until it gets to the market it will not have much meaning. You know that the distribution of this product is through licenced retailers using surface tanks, then you get it to the jerry cans, then bottles before it gets to the actual consumers.

So you can have 40days sufficiency in the high sea, but until you adopt a system that allows for this sufficiency to go through every channel the impact will be felt.

That is why we want to have a meeting so that we can all put heads together.”In line with its resolve to end the acute scarcity and high cost of kerosene within 10 days, the Nigerian National Petroleum Corporation, NNPC, has released 10,000 metric tonnes, MT, of the scarce product into the market.

The move has brought about appreciable drop in the price of the product, which sold at about N130/litre in some depots to now N100/L.

Confirming the entry of the product, the Executive Secretary, Major Oil Marketers Association of Nigeria, MOMAN, Mr Obafemi Olawore, told Vanguard that price will continue to ease the more the product comes into the market.

He disclosed that the NNPC had promised to deliver to MOMAN depot up to 30,000MT by this week. “So the whole issue is now looking a bit positive, and if supply continues in this manner, it is only a matter of time before the scarcity ends and the product becomes more affordable.”

To support the move, the NNPC at a meeting with MOMAN last week, said it is concluding plans to also import more of the scarce product to complement local refining capacity, even as it said it has 40 days sufficiency of the product in stock.

In line with the above, the NNPC and MOMAN agreed to set up a Joint Monitoring Team, to ensure that kerosene released to marketers from the stock reserves will not be diverted, but distributed at all the partners retail outlets nationwide.

The Group Managing Director, NNPC, Mr Austen Oniwon, who addressed journalists at the end of the closed door meeting, “Reassured the nation that the principal stakeholders have given an undertaken that kerosene will be available within 10 days in all the NNPC and MOMAN retail outlets.”

Oniwon said the move is in direct response to alleviate the hardship Nigerians are experiencing in accessing thee scarce commodity, which they use for their domestic fuel needs.

For months now, Nigerians have had to pay through their noses for kerosene, which now sells between N150 and N200 per litre depending on the outlet. Although the former Minister of Petroleum resources, Mrs Diezani Alison-Madueke, a week to her exit in office gave matching orders to NNPC and the Department of Petroleum Resources, DPR, the regulator of the industry to flood the market with kerosene in order to crash prices, to no avail.

Oniwon, who refused to say how much quantity of kerosene the corporation intends to import or how much it would be sold to the public, however, told Vanguard that flooding the market will make price to obey the law of supply and demand, thereby, crashing price to the expected N50/Litre.

Concurring, Olawore said that the majors, all of whom were represented by the chief executive of respective member companies, agreed to cooperate with NNPC in the supply and distribution of kerosene in all their outlets.

He said, “We have been given 10 days, but we want to assure Nigerians that we will start immediately; we have done it in the past, and we will do it again nationwide.”

He tasked Nigerians to report any sharp practices by any of the MOMAN member outlet, which include Mobil, Total, MRS, Oando ,AP, and Conoil, with a view to imposing proper sanctions.