Kachikwu Rolls Out Emergency Plan to End Petrol Scarcity

…As IPMAN Blames Scarcity On Apapa Gridlock

Following the directive by the Federal Executive Council (FEC) to the Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, to end the fuel shortages by the weekend, the minister has at the weekend rolled out short-term measures, which he said would end the fuel scarcity.Kachikwu, who briefed journalists in Abuja on the measures, explained that the fuel shortages were occasioned by a gap in the volume of products available in the country.

This is even as the National Chairman, Independent Petroleum Marketers Association of Nigeria, IPMAN, Chinedu Okoronkwo, confirmed availability of products in the country but that the scarcity was being caused mainly by bad roads and Apapa road blockage.

Kachikwu also noted that the gap in supply was caused by the time lag in the delivery of products and the reluctance by oil marketers to import petrol. Kachikwu added that the shortfall was caused by the rising price of crude oil, which he said had forced oil markers to defer imports.

He said within the short-term, the NNPC would increase the distribution of petrol from its strategic reserves to cushion the gap, while the DPR and Petroleum Products Pricing and Regulatory Agency (PPPRA) would increase their monitoring of the market to penalise instances of hoarding by marketers.

He also stated that within the coming weeks, the Kaduna and Port Harcourt refineries would respectively deliver up to 750,000 and 2.1 million litres per day to support efforts to bridge the shortfall in supply.

NNPC, he added, would have about four of its petrol cargoes come in within the next few days, and as much as 30 cargoes before January ends."What caused some of this was some level of gaps in terms of volume. That gap was because the NNPC is the only one importing most of the products currently.

"Most of the people we expected in the private sector to import products were not able to bring in products, some of them have pushed back the days they were supposed to bring in products to January and so you have NNPC rapidly trying to fill in the product requirements in terms of 100 per cent capacity basis.

"Luckily, there is enough storage which they are releasing right now. They are also taking emergency steps to try and fill whatever gaps there are in December. Post-January, there won't be much of an issue because most of the deliveries expected should be coming in," said Kachikwu.On the comprehensive restoration work aimed at bringing the four refineries operated by NNPC in Kaduna, Warri and Port Harcourt back to their nameplate production capacities, Kachikwu said repairs would eventually start in January 2018.

He explained that the technical committee in charge of restoring the refineries was almost done with its work of benchmarking costs and streamlining bidding firms and would submit its report for presidential approval before the year ends.

He noted that after that, it is expected that the repairs on the refineries would commence in January.

He did not state how long the repairs would last but noted that so far, the committee had been able to trim down the list of bids for the job from over 40 to about 11 serious and committed firms.

"The chief operating officer who heads the technical team that is overseeing this has worked very hard in the last six months, doing the benchmark analyses and negotiations with very high responses that we've received from many parties which is a very encouraging thing.

"I think it has gone down from over 40 applicants to 24, to about 11, and I have instructed him to complete that process before the end of the year so that we can get approval from the president and go forward to award those, so that by early next year, actual work can start," said Kachikwu, in response to a question on the status of the process.

He added: "A lot of benchmark analysis is going on in terms of comparing costs and making sure we are not going to pay more, identifying the right partners and making sure that they have money in the bank once we have agreed for this to proceed. The promises we have made in terms of the refineries, we are putting a lot of efforts on them.

"In the long-term, the position remains what we've said that our refineries must begin to work. The process of the refineries' upgrade is almost complete and very soon we will announce those who eventually win that process and they can get on with work beginning from January."

On his part, the IPMAN Chairman stated that  "There is no scarcity, just the aftermath of the gridlock at Apapa area led to shortage of product at the filling stations. Tankers are unable to navigate out of the gridlock at the area and that has led to difficulties of the product to get to the filling stations. Marketers will not hoard product if they have to sell. However, I believe the Federal Government is not oblivious to the sensitivity of the season, and NNPC is working assiduously to ensure steady supply of the product to avert such thing as scarcity." 

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