A Review of the Nigerian Energy Industry

Adulteration of lubricants worries manufacturers, consumers

Conoil lubricants05 June 2014, Lagos – The Lubricant Producers Association of Nigeria recently tabled a complaint before the Ministry of Industry, Trade and Investment, following the influx of fake lubricants into the Nigerian market.

The association also asked the Federal Government through its agencies to find a solution to the problem considering the level of revenue loss they were recording, as the adulterators controlled a portion of the market.

Apart from the uncontrolled importation of the adulterated lubricants, it has been established that locally, some dubious people refill lubricant containers with lubricant-substances, and subsequently sell the same to unsuspecting citizens for almost the same price as the original product.

This development, which has persisted for a long while now, had been described as the bane of the industry, as many of the local manufacturers are now almost out of the market.

The Executive Secretary, LUPAN, Mr. Emeka Obidike, had said most of the products in question were produced with recycled oils, with little or no additives.

LUPAN had warned that granting lubricants import licences to people without knowledge of the industry could result in closure of legitimate existing plants, unemployment and economic losses to the nation.

Currently in Nigeria, there are two regulatory agencies for lubricants— the Department of Petroleum Resources, and the Standards Organisation of Nigeria. While DPR licenses firms to produce any petroleum product, SON monitors quality of products to ensure standardisation

The DPR had consented to initiating the requisite mechanisms to fight substandard lubes in the country. The agency had prohibited the sale of lubricants or materials claimed to be lubricants in unbranded, unlabeled packs or plastic bottles in open market areas or roadside stands.

It also said it was working to inform stakeholders of the dangers of patronising unlicensed retailers, and creating an awareness campaign to dissuade the public from using unbranded lubricants.

In line with this, the Federal Government had also said it was stepping up supervision of base oil importation in the attempt to ensure base oils go only to licensed lube blenders, rather than ending up in the hands of vendors who pass the raw product off as finished lubricants.

Government, through its agencies, is also making effort to increase the frequency of quality assurance visits to blending plants, with a move to deploy motorised testing laboratories in every part of the country to check adulterated lubricants

To check this trend, some stakeholders in the industry have reiterated the need for higher tariff on imported lubricants in order to protect local producers and help them to remain competitive. Low tariff on raw materials would also lift the local industry.

Adulterated lubricants, according to LUPAN, could cause irreparable damage to engines, through wearing and knocking.

Despite these moves, the DPR recently discovered an illegal factory in Niger State where the packaging of adulterated lubricants was being carried out.

The illegal factory packaging adulterated lubricants in Usuba Village, near Kontagora in Niger was operated by IMN Auto parts and had about 40 persons, mostly women working for them. The workers were not equipped with any safety clothing or measures to protect these vulnerable women, who were not aware of the dangers they were being exposed to.

Given the hazardous nature of the chemical components of lubricants, the complexity in lubricants’ refining and packaging and their consequences on safety, formal training and meticulous care are needed for their blending and packaging.

This is apart from the dangers many people who were victims of adulterated oil had to face. Some, according to DPR, never lived to tell their story because the engines of their cars suddenly stop while they were on high speed, resulting in accidents with the attendant deaths and injuries.

In 2010, the DPR had raised the alarm over widespread substandard lubricants in the Nigerian market. This had prompted it to start implementing a zero tolerance policy to rein in producers, distributors, agents and traders of adulterated lubricants.

Also, the department also stepped up supervision of base oils importation in the attempt to ensure that only licensed lubricant blenders and not roadside vendors package and dispense them.

It is therefore estimated that Nigeria’s economy loses about N250bn annually to adulterated lubricants processed and sold at roadsides.

LUPAN had expressed worries that the investments of its members running into billions of naira would crumble if the anomaly was not addressed.

For instance, The Kontagora factory case has shown that the illegal factories that package lubricants neither pay tax nor pay their workers well. The Kontagora factory, it was learnt, pays its workers about N500 a day, which amounts to N15, 000 per month, assuming they work every day of the month.

The environment is not spared of negative effects of fake lubricants. Since no safety precautions are taken to protect the humans packaging the fake products, no safety measures are also taken to protect the physical environment.

As a result of this, farmlands are also despoiled and water sources contaminated with cancer- causing substances, which threaten the safety of communities.

According to DPR Zonal Public Relations Officer covering the Kontagora area, Mr. Muhammed Saidu, the Kontogora lube factory was operating without approval from DPR, and was threatening the safety of the environment.

Saidu said that the products of the company could not be anything of standard since its operations were illegal and not in line with industry’ best practices.

The DPR said it was collaborating with SON and LUPAN in the campaign against the distribution and retailing of adulterated lubricants.

The Director General of SON, Mr. Joseph Odumodu, had stressed that there was a multiplicity of problems within the lubricants market.

He had said that, “One of the challenges is the fact that people are bringing in processed lubricants. They were lubricants used before and cleaned up. The fact is that they do not have the same ability to withstand the pressure from genuine ones.

“One major challenge is how we can stop the roadside people from selling base oil as lubricants. Most of these oils are base oil and some of them unprocessed. Unfortunately, an average Nigerian does not know the difference. Once they see what they call engine oil or lubricant, they use them.”

In a bid to ameliorate the situation, the DPR said it remained committed to mobilising the rest of the industry to check the excesses of adulterators, while adding that it had strengthened its licensing and permits processes by making sure that only genuine firms are allowed to import and blend lubricants.

Legitimate companies in the business, it was learnt, will re-package their products to protect them from adulteration. Firms like Conoil, Oando, among others, had joined the campaign.

Recently, Oando Marketing Plc called on the Federal Government to curb the influx of sub-standard lubricants into the Nigerian market.

The firm had said that the influx of fake and substandard foreign lubricants into Nigeria was not good for the industry.

Inasmuch as stakeholders in the industry want a clampdown on fake dealers in lubricant products, they also believe that strict adherence to provisions of the Local Content Act, as far as the business is concerned, will strengthen local players, drive creativity, and check ethical abuse.


–  Stanley Opara, The Punch

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