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The Nigeria’s petroleum products distribution and supply chain still has tougher times ahead as a result of the prevailing current foreign exchange market intricacies that are still very pronounced in the oil and gas industry.
This was the concensus of opinion of some Oil and gas experts at a media virtual training organized for Journalists covering the Energy beat by Major Energy marketers Association of Nigeria ( MEMAN) in Lagos.
During the Quarterly media training and engagement with the topic: INTRODUCTION TO AUTOGAS/ LPG AND CNG AND THE EVOLVING PRICE OF PMS “; the speakers complained that the dollarization of the supply chain and the uncertainty of market forces has stopped some members from further importation of premium motor spirit ( pms) .
Their contention is hinged on the fact that it has become virtually impossible to calculate the landing cost of the products thereby making it difficult to determine the appropriate pump price to fix for selling the petroleum product.
The executive secretary of MEMAN, Mr clement Isong in his own presentation said the unfolding events at the industry value chain shows clearly that their investment is not fully protected with dollarization of certain charges.
Mr Isong explained that the market and the final consumers are not free from the consequences of government policy which allows ,Nigeria ports Authority(NPA) and the Nigeria Maritime Administration and safety agency ( NIMASA) to make their charges in dollars.
He noted that even though marketers receive products from the NNPC LIMITED,ship products offload is transacted in dollars thereby pushing up the cost of the pump price.In his words,Mr isong said”keep the dollar out of the supply chain and strengthen the naira so as to ease all the pressure playing out in the industry.
The MEMAN Executive secretary submitted that members of his association are more concerned about three major things,namely: sustainability, efficiency and affordability of energy for all category of Nigerians.He implored Nigerians to make a shift to energy transition into gas space because, according to him, it is more cleaner,safer and relatively cheaper.
Mr Isong commended the federal government for it’s faithfulness in giving various interventions since it exited the petrol subsidy regime but noted that the dollarization policy is weakening the industry as well as discouraging willing and potential investors.
Giving a detailed breakdown of what is transpiring at the value chain process,Mr Isong revealed that marketers usually pay NNPCL about 10 dollars per metric ton which would translate to higher pump because of the current high exchange rate. On transportation of PMS,he explained that even though marketers have separate negotiations, transporters still charge them between 5 naira to 8 naira per litter.
In his own paper on transition shift from petrol to gas,Mr Femi Fanoiki,a consultant on Liquefied Petroleum Gas( LPG) disclosed that efforts are being stepped up towards driving LPG application in both the industrial and automotive services, adding that interventions by the government is encouraging investment in that space,noting that more infrastructural facelifting is still needed to boost the entire production system .
While speaking on the benefits of Compressed Natural Gas( CNG), Mrs Adelanke Bayo Adepoju , a Gas and Renewable energy Specialist, disclosed that concerted efforts are on to convert about 1 million vehicles to run on Gas by 2027 while over one thousand conversion workshops have been established all over Nigeria.
