Mr. Lucky Obogo is a petroleum marketer, he runs a company in the downstream oil and gas sector in Nigeria; L&T Logistics, it deals in selling and moving petroleum products from the tank farms located around Ibafon-Ibru complex in Apapa Lagos. He spoke with Shipping Position Daily correspondent; Dapo Olawuni about the many challenges encountered by operators around the tank farms.
What is the L&T Logistics all about?
Mr. Lucky Obogo is a petroleum marketer, he runs a company in the downstream oil and gas sector in Nigeria; L&T Logistics, it deals in selling and moving petroleum products from the tank farms located around Ibafon-Ibru complex in Apapa Lagos. He spoke with Shipping Position Daily correspondent; Dapo Olawuni about the many challenges encountered by operators around the tank farms.
What is the L&T Logistics all about?
We do not import products, like I always tell people that the oil and gas sector is complex, when you talk about the downstream, a lot of things happen there, there is one thing to bring in product and another thing is how to sell the products. Sometimes the importers do not always have the opportunity to meet with the direct consumers and this is where we in L&T Logistics come in, we kind of bridging the gap between the importer and the consumers, as far as the sector is concerned we render services, in the shipping sector they call it custom brokerage, bringing customers and collecting your commissions, that is what we do for now.
Is your company also involved in product haulage?
I wouldn't say we are involved, but we know about it because sometimes, if the consumers know how to go around the depots to search for product and get haulage to move it, then they will not come to us. A customer will come to you to get product, after this he will ask for trucks to move it to the point of delivery and we also get the trucks.
What are the challenges is this business?
There are lots of challenges, one of them is that you don't have the opportunity to fix your own price, it is the importer that will fix the price for you, if you come in the morning you have to wait for the importer to fix price for you before you can start calling your customers, sometimes we find it difficult. Sometimes the importers will want to reach out to their own customers first. Apart from this, we also face the challenge of traffic in this area, this is the place we have been doing business for a long time, this is where we know, even though there are other axis, but it is good to operate in the environment you know, sometimes we want to bring our customers here, but because of the construction work here they will tell you they cannot come, so traffic is one of our major challenge. It’s a good job that they are doing here, looking at the construction and the way they are doing it, I don't think there is any witchcraft that can destroy it.
What is responsible for the unequal pricing of product at the depot?
My line of product is AGO and we also have this problem, I thank God that the government is trying to intervene at the moment, wherever anybody is getting this product from, either from Vittol of Trafigurral which are the two main sources, but you will find out that one importer will still sell far lower than the other, they sell far below even the landing cost, when you begin to ask questions you will realize that some of them have a way of blending the product offshore. But in law they say he who assert must prove, I have not been there before so it’s just rumour that sometimes some people intentionally look for product that has been mixed or do the mixing by themselves in order to maximize profit. In this game, it is a numbers thing, there is not loyal customer, once your price is good everybody comes to you, if the price is higher they will leave you, so what most importers do is look for ways to land the product very cheap by any means, you find out that people that import genuine product always have issues of how to sell the products. Another challenge is the different AGO's coming into the market, some are called 'black AGO' 'Bayelsa AGO' and other different name, you will find out that these product sell N25 lesser than what it’s supposed to be, but you know our Nigerian mentality, we are not always bothered.
What are the regulatory agencies doing to check these anomalies?
This is the question I also ask all the time, for AGO, there is a standard that is allowed, it is usually checked by flash points and density, for AGO the flash point is 65 to 66, anything below this we call it off-spec product, but when it is above we call it on-spec product, the density also is not supposed to go below 0.82 which is the normal DPR standard. Now, the regulatory guys here, I want to believe that they know their job but some customers will still tell you that some depots around Kirikiri area are selling for lesser prices, except there is another way that they bring in these products maybe it’s in the night I cannot say, this is why I use to ask that with the DPR in place, how come these products still come into the tank? But I know that the government is really working because we hear of task forces everywhere, from the products that we load here, if you are not careful and you do not prepare your papers very well, there are task forces that will stop you and seize the truck and the product.
It has been discovered that some private jetties actually allow these adulterated products to come in; do you think such should be closed down?
I will say that if these jetties are going to pose a threat to the country and if these men of the dark are there posing threat to us, then I will support that they should be shut down because it is affecting a whole lot of things, it was reported in the newspapers that the ammunitions they found at a warehouse is enough to engage Nigeria in a war for three months, then you begin to ask yourself, how did these ammunitions find their ways into the country, I know it cannot come in through the ports, it is through these illegal points, government should shut them down, I know that for you to own a jetty, there are some processes and paper works you need to put in place, apart from this the government will also come there to inspect what you are doing at the jetty. I once worked onboard a barge for a long time, I worked with Genesis Shipping, owners of Integrated Oil, and I discovered that you don't just operate a barge on the waterways, there should be a license, the badge must have a name so that it can easily be traced when it commits any atrocity and the owner will equally be traced. So when you used the word illegal jetty that means it has not done the proper thing, so if anything happens the government cannot trace it, so if it is not properly registered, let government lock it up.
How will you describe security around the tank farms?
Since the issue of this Boko Haram has started coming up security has been tight around here. Formerly you can come to the depot and just go down to the jetty side, those days I remember you can even drive to those places, but now, if you don't have proper identification you will not be allowed to enter the premises, I use to go there myself to check vessel line up in order to take stock, but because of the security issues I am always reluctant to go there, for you to enter Ibru yard now they must know you and you must have a business to do there.
But I don't think there are any security measures outside the gates, you still see crowds around the depot entrances. If you watch very well, it depends on where you are coming from, but you can't go close to the fence outside again, even the union offices have been pushed away from the fence, before now everything was just to the fence, there are some boys that used to peddle diesel around that area, but now they have been removed from there because of the security challenges, so I believe the security is working.
Do you subscribe to the call for the relocation of tank farms from Apapa?
To where? We have18 depots here; if am not mistaken, and they are all functioning, the crowd you see around the depot all have something doing there, all the trucks that come in here have something to do, if you now move this depot to anywhere you want to move it to, this same crowd, this same number of trucks that come in here every week will be moved to the same place, that is why I asked you that question, to where?
Are you aware that there is an expanse of land around Lekki that issuitable for tank farm construction?
If trucks want to start going to load at Lekki, where would be there route?, for me that I stay in Apapa, if I want to get to Lekki I will have to pass through Victoria Island, so, are the trucks going to be taking the same route or through Ibadan or Sagamu to access Lekki? You cannot say you want to solve a problem and end up creating another one.
Does it then mean that residents and offices in Apapa should not expect any respite?
By the time they finish expanding the roads which they are doing currently, it will improve, it is the roads that are not good, but thank God that government is now working on it, by the time there are no potholes on the roads again, I doubt if there is going to be any problems. If you are driving and you slow down because of a little pothole, that single action will affect a lot of vehicles coming behind you. Another problem is the attitude of Nigerians, the change that we are praying for can begin from us, we can learn how to make things right, if everyone can move on a straight line in the traffic, we will all get to where we are going, we should stop blaming government for everything and learn to do things right.
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