The low supply of Premium Motor Spirit, popularly called petrol, being experienced in parts of Lagos and South-Western states may drag till the end of September, and might spread to other locations if not addressed in earnest.
It was gathered on Thursday that the situation may linger till month end because the System 2B pipeline in front of Good Luck Estate at Idimu, Alimosho Local Council Development Area of Lagos, is going to be ready for use by September ending.
Oil marketers had attributed the cause of the recent fuel queues experienced in many parts of Lagos and some states in the South-West to the disruptive activities of vandals.
They explained that the shutdown of the System 2B pipeline, which supplies large volumes of products to the region, had impacted negatively in the flow of PMS in Lagos and neighbouring states.
“From our end, the issue has been with the pipeline vandalism which we raised an alarm over since July. Satellite depot has not loaded any product in the last three weeks, and whenever there is a problem here, it is going to affect Lagos and the whole of South-West,” the Chairman, Independent Petroleum Marketers Association of Nigeria, Satellite Depot, Akin Akinrinade, had told The PUNCH on Tuesday.
Akinrinade had further explained, “Although I don’t know what has been happening in other depots, from what we gathered yesterday, even NNPC Retail has been operating skeletal product dispatching. The NNPC Retail loaded just three to four trucks to Ikoyi on Monday. No product was dispatched to other places. I don’t know about other depots.”
But on Thursday, the Chief Corporate Communications Officer, Nigerian National Petroleum Company Limited, Garba-Deen Muhammad, said the vandalised pipeline was being worked on by the NNPCL.
He told our correspondent that the facility would be ready towards the end of September, which implies that the supply hiccups associated with the shutdown of the pipeline could linger till month end.
The NNPCL official admitted that there were issues with the pipeline but stated that “the company is in the process of restoring it and we are hoping that it should be okay by the end of September.
“Right now its being worked on and hopefully it should be back and restored for proper use by the end of September. So that is the position right now, by the end of September the pipeline should be back on stream.”
Imports stalled
Commenting on the development the President, Petroleum Products Retail Outlets Owners Association of Nigeria, Billy Gillis-Harry, said there was already a drop in the supply of petrol nationwide.
He also stated that the foreign exchange crisis in Nigeria had discouraged more marketers from implementing their PMS importation plans.
“There’s already short supply of products and the reasons are not far-fetched. In the beginning of the subsidy regime most of our marketers decided to pull resources and import.
“They were to import about 25,000 metric tonnes each. But somewhere along the line they could not meet their cash calls because dollar jumped from the official rate of about N450 to over N700.
“So it was no longer accessible and marketers needed to depend on the parallel market for it, even when the government promised to create opportunities in the I&E window. So clearly, the issues at stake are very simple. Supply is not there as before and it is a problem.”
Asked whether this means the NNPCL, which prides itself as the supplier of last resort, was not importing enough products, Gillis-Harry replied, “Well, as it is today, we cannot say they are not importing. But we need to see results. If there are enough imports, we need to see the result of the imports.”
The National Controller Operations, IPMAN, Mike Osatuyi, had told The PUNCH earlier that there was no cause for alarm with respect to product availability.
“Yes, there are still queues but NNPCL has assured us that there is no cause for alarm. So, let us rely on their statement for some days before we know what to do,” Osatuyi had stated on Wednesday.
Also, the President, IPMAN, Chinedu Okonkwo had said he had a meeting with NNPCL Retail on Wednesday on the concerns raised by marketers.
“I just left NNPC Retail, and they assured us that they have plenty of products. Go to the depots, they are loading,” he had told The PUNCH on Wednesday
The PUNCH had also reported on Thursday that a source at the Nigerian Midstream and Downstream Petroleum Regulatory Agency who pleaded to speak on condition of anonymity, said there was more than enough stock in-country.
According to the official, a total of 200,000 metric tonnes, equivalent to about 540 million litres of fuel, is currently at various depots in Lagos.
“We are taking concrete steps to close the gaps in product distribution, and I can tell you that there is no significant difference in what was trucked out last week and this week,” he said while declining to state what quantity was distributed last week.
“The depots are not dry. Everywhere is wet. There are two vessels discharging PMS at Apapa jetty, one at Ijegun, one at Coconut, Ibafo, and one at MRS, Tincan. Cumulatively, we are talking about 200,000 metric tonnes of PMS, equivalent to about 540 million litres in various shore tanks in Lagos. So, we are taking time to close the supply gaps, and I can assure you that the queues would disappear just as they came,” the source stated.
Meanwhile, when told on Thursday that other states outside the South-West had no queues and whether they would experience such in due course, the PETROAN president explained why this was so.
He said, “First of all, don’t forget that buyers are also having issues with their pockets. So vehicles are not buying are not buying as much petroleum products as they used to buy.
“Right now there are different modalities that Nigerians are managing to get through. You have families that are dropping several cars in their fleets, you have neighbours that are joining resources, trying to pass through the same area where they can get closer enough to their offices and business places.
“So with that kind of situation in several parts of Nigeria there will be not so much pressure on PMS. That is why it has not being pronounced as such outside Lagos.
“But it is pronounced this much in Lagos because the state is an entire city that has over 15 million residents and every day, whether subsidy or no subsidy, people must move in Lagos. So that is the reason.”
Gillis-Harry, however, stated that if the low supply situation should persist for long, the queues would spread to other regions of the country.
