As NNPC to Import 46 Cargoes of Fuel...
Again, Marketers Hike Petrol Price
Local refineries produce 10m litres daily
By Mike Oduniyi
Major oil marketing companies, yesterday hiked the pump price of petrol by 2.3 percent to N43.90 per litre, saying the amount reflected the cost of the cargoes imported into the country last month. Before now, a litre of petrol sold for N42.90.
But the Nigerian National Petroleum Corporation (NNPC), after an initial delay, has now placed orders for the importation of 46 cargoes of petroleum products for the third quarter (July-September) this year.
Major oil marketers have raised the price of petrol to N43.90 a litre from N42.90. Although many of the filling stations in Lagos yesterday were yet to effect changes in the pumps, industry officials said the new price reflected the landing and distribution cost for the fuel the major marketers imported early this month.
THISDAY observed that an Oando Plc station at Maryland, Lagos as well as Total filling stations at Ojota also in Lagos, had already adjusted their pumps and price boards to reflect the new price.
At a Conoil Plc station on Western Avenue, Lagos, an attendant said while the pumps were yet to be changed, management had already put them on alert for the impending change.
"The marketers have put the public on notice before now on the likely review in petrol price when their imported cargoe arrives," said one industry official. "It reflects the price of crude in the month of June," he added.
Major marketers which abandoned importation citing high cost, said recently that the cargoes of fuel they had imported would land at the cost of N45 per litre of petrol.
They said the blending price of the product with the N33.50 per litre of fuel lifted from NNPC depot will give an average price of N41.78 a litre and that when the minimum margins for operating expenses, overheads and marketers' return on investment are added to the final procurement costs, it will naturally raise the pump price.
Meanwhile, THISDAY checks revealed that the number of cargoes contracted out to oil traders last week, fell short of the 60 cargoes imported by the NNPC for the second quarter (April-June) 2004. The short-fall will be filled with more than 100 percent increase in volume of fuel produced by the four refineries.
A breakdown of the fuel ordered by the NNPC showed that oil traders will supply 40 cargoes of premium motor spirit (PMS) and six cargoes of Dual Purpose Kerosene (DPK). Like in the second quarter, the corporation also did not place orders for diesel.
NNPC sources said the cut in imports apart from the need to cut down on losses, also reflected the increase in the level of production by the local refineries.
Official statistics made available at the weekend showed that the refineries with combined production capacity of 445,000 barrels per day (bpd) were producing at 62 percent of their capacity. The plants were supplying 10 million litres of petrol daily, up from 4.8 million litres.
NNPC officials told THISDAY that the refineries will achieve production capacity of about 80 percent by first week of September.
NNPC Group Managing Director, Engineer Funso Kupolokun, had early this year said the target was to cut contracts for the importation of petrol down to six cargoes per month from 24 cargoes.
The calculation, he said, was hinged on the major upgrade of the Fluid Catalytic Cracking (FCC) units of the refineries, which will raise output to 18 million litres of petrol per day. Domestic demand is put at 30 million litres.
THISDAY further gathered that the NNPC GMD met with the management of the refineries in Kaduna at the weekend, where strategies to run the plants at maximum capacity were discussed.
"We are working to ensure that the refineries attain maximum production capacity. Work on the plants have reached advanced stage and it is incumbent on the managers to get set to run them efficiently," a source said yesterday.
The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) and the Nigerian Union of Petroleum and Natural gas Workers (NUPENG) at the weekend issued a 21-day ultimatum for the total rehabilitation of the refineries failing which they would embark on strike.
Kupolokun, who confirmed the Kaduna meeting, told THISDAY in Lagos at the weekend that the task handed down to the chief executives of the refineries was to ensure that the plants played the required role under the deregulated environment.
"The managers of the refineries must face realities that the plants must produce to meet local demand," said Kupolokun. He added "We are operating in a deregulated environment and running the refineries efficiently is paramount."
Kupolokun also allayed the fears of the NNPC workers over the planned privatisation of the refineries and the new pension bill. He said the management would safeguard the interest of the workers.
"The benefits of the workers will be paid. Nobody should have apprehension that both privatisation and pension bill are in the best interest of the workers," he said.
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