Even as he nation’s downstream oil sector is still immersed in controversy over the recent fuel import allocation, the agency which is at the middle of the saga, the Petroleum Products Pricing and Regulatory Agency(PPPRA), has defended its action’
Executive Secretary of PPPRA, Mr. Abimbola Ibikunle told newsmen in Abuja last week that the agency acted within its mandate, even as he stressed that there was need to "discourage monopoly, cartelisation and any anti-competitive market behaviours."
Ibikunle, while describing the criticisms which followed the recent allocation as "malicious and mischievous innuendos," allegedly, being sponsored "by a cartel that is desperate to influence the regulatory decisions of the agency, ensure sustenance of industry monopoly, and perpetuate profiteering and distortion of products supply" defended the agency stressing that PPPRA has religiously upheld the tenets of healthy competition and a level playing field for all operators.
According to him, the allocation of petroleum import quota is based on some criteria, chief among, which is due consideration for the performance history of marketers.
Defending the decision to allocate import to ‘traders’ , he said that "the engagement of traders to supply products into the system is not a strange practice as the bulk of supplies by the NNPC and other major marketers are carried out by the traders", adding that the downstream sector is made up of several business units and participants are free to choose at what level they wish to intervene; thus there are many depot owners who do not import but service others by offering their facilities for throughput only".
He explained that available data indicated that most marketers import less than 50 per cent of the total quarterly quantity allocated to them, while some so-called traders with encouraging performance history continue to play significant roles in the fuel supply chain in the nation’s downstream sector.
He nevertheless explained that fuel consumption level and rate of products supply are assessed quarterly in order to determine the supply gap, adding that "sequel to the call for expression of interest and submission of planned imports for the quarter by the marketers, the agency then allocates appropriate quantity based on certain criteria".
According to him, the PPPRA always uses criteria such as : historical supply performance, quantity of products requested, capital investment base, ability to finance products imports, projected consumption level and funds available to subsidize products in the decision as to which organisation will get what..
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