24 March 2016, Abuja – The Minister of State for Petroleum Resources, Dr. Emmanuel Kachikwu, on Wednesday, said despite the efforts being put in place by the Federal Government, fuel queues might not be completely eliminated until about two months.
He said since he was not a magician, the fuel queues could not be eliminated with a magic wand.
He however said he and members of his team were working hard to resolve the fuel crisis.
The scarcity of Premium Motor Spirit, popularly known as petrol, has lingered since January as hundreds of motorists besiege few filling stations that dispense the product on a daily basis.
Kachikwu’s comments have, however, drawn heavy criticisms from various stakeholders, including the organised labour, petroleum marketers, oil industry workers, manufacturers and experts in the oil sector.
The Trade Union Congress specifically asked the minister to resign instead of giving Nigerians excuses on why it would be impossible to get fuel easily in the country before June.
Kachikwu, who is also the Group Managing Director of the Nigerian National Petroleum Corporation, spoke with State House correspondents shortly after he led a joint delegation of the Petroleum and Natural Gas Senior Staff Association of Nigeria and the Nigeria Union of Petroleum and Natural Gas Workers to meet with President Muhammadu Buhari at the Presidential Villa, Abuja.
He said with the reality on the ground, it was by sheer magic that the country had the amount of products it currently had at the filling stations.
He said, “One of the training I did not receive is that of a magician, but I am working very hard to ensure some of these issues go away.
“And let us be honest, for the five or six months we have been here, NNPC has moved from a 50 per cent importer of products to basically a 100 per cent importer and the 445,000 barrels per day that were allocated were to cover between 50 and 55 per cent importation.
“So it is quite frankly by sheer magic that we even have the amount of products at the stations. We are looking to see how to get foreign exchange input; the President and I discussed extensively on how to get more crude directed at importation.
“His Excellency (Buhari) will rather have less crude but have individuals in the society suffer less with inconveniences than have more crude and have them continue to suffer.
“So we are going to put a new model to enable us to increase the pace and actually get majors as part of the crew of those to bring in more products so that the NNPC will sort of go back on the capacity of what it used to do and the majors will take over the balance of importation.
“I think if we do that, although I don’t want to put a time frame, but I will expect that over the next two months, we should see quite frankly a complete elimination of this (fuel queues).’’
Kachikwu said government’s strategy was that whatever was produced in the refineries would not be sold but be kept in strategic reserves.
This, he explained, was because the major problem was that there was no reserve anytime there was a gap in supply.
Kachikwu said the meeting Buhari had with the unions was to review the oil industry, especially as it concerned areas that the President himself was finding solutions to.
He said the union leaders agreed to collaborate with the government.
When he was asked to be specific on some of the concerns raised by the union leaders, Kachikwu mentioned the Petroleum Industry Bill, refineries and the issue of fuel scarcity.
He said, “I will probably highlight a few areas of concern. On the PIB, the union wants us to obviously work harder than we do and try to get the PIB passed as soon as possible.
“They are worried about the fuel scarcity issue and want a long time solution to finally resolve this issue.
“They are worried about the refineries and are thankful we did not sell the refineries without looking to work collaboratively with them to see how to make the refineries work.’’
The National President of NUPENG, Igwe Achese, described the meeting with the President as a successful one.
“We tabled the issue of fuel scarcity, the quick passage of the PIB and to see how the sector can bounce back economically and to make Nigerians smile again. Clearly, we talked more on the corruption in the oil and gas sector, product allocations.
Also, the President of PENGASSAN, Olabode Johnson, said the President told them that he created the NNPC and he was emotionally attached to the firm.
Johnson quoted Buhari as saying that everything that was going to happen in NNPC must follow due process.
He added, “The President said he is concerned about what Nigerians are going through and he bears their pains and whatever he is going to do, he will do it with their support so that Nigerians can enjoy the benefits of the NNPC.’’
But the Nigeria Labour Congress described as unfortunate Kachikwu’s statement that it would take more than two months for the current fuel queues to clear.
The General Secretary of the NLC, Dr. Peter Ozo-Eson, said in a telephone interview with one of our correspondents that it was wrong of any agent of government to resign himself to a position that would subject Nigerians to months of long fuel queues.
Ozo-Eson believed that it was the responsibility of the minister to ensure the removal of the factors responsible for the current queues at the filling stations and to save Nigerians from the painful wait to get petroleum products.
He said, “As far as we are concerned, one day of queues is unacceptable to Nigerians, and the hardship Nigerians have been subjected to, through the queues over a long period now, is actually something that should be condemned.
“Apart from the hardship to Nigerians, the cost of these protracted queues on an economy that is already in crisis is enormous, and actually makes the issue of the revival of the economy even more difficult.’’
The TUC, through its President, Mr. Bala Kaigama, called on Kachikwu to resign to give room for a better person to be appointed if he lacked the capacity to solve the current problem.
Kaigama said the positions occupied by the minister were too demanding for him and urged Buhari to appoint a group managing director for the NNPC.
Kaigama stated, “If he is not a magician, he should resign now. What we are saying is that Nigerians are getting impatient with him.
“So, if he has no quick fix to it, he should just quit. We are getting impatient. He is moving from one unpopular policy to another, yet we cannot see any quick fix.’’
Also, workers in the oil and gas sector on Wednesday said they were at a loss as to what was really the cause of fuel scarcity in the country.
The workers, who spoke under the aegis of the PENGASSAN and the NUPENG, stated that the minister should be questioned on the development.
The National Public Relations Officer, PENGASSAN, Mr. Emmanuel Ojugbana, told The PUNCH that the association was becoming confused as to why the country was still experiencing fuel queues despite a series of promises by the minister and the NNPC.
Ojugbana stated, “The issue of fuel scarcity or queues has become almost a recurring issue nowadays that sometimes, you wonder what actually the problem is.
“NNPC will tell you it has sufficient fuel but if you go to the filling stations, you won’t find the product. Also in most of the filling stations, you can’t find fuel at the regulated price. So, it is really a problem.”
When contacted, the Group Chairman, NUPENG, NNPC Branch, Mr. Odudu Udofia, told one of our correspondents that his union was mainly concerned with staff welfare.
He, however, stated that the petroleum minister and the NNPC management should be interrogated on the issue.
Udofia said, “As for us, we are more interested in staff welfare at the moment considering the restructuring and other issues at the NNPC. But as for petrol scarcity or fuel queues, the minister and the NNPC managers should be called to explain why.”
In his own reaction, the Chairman and Managing Director, Mobil Oil Nigeria Plc, Mr. Tunji Oyebanji, in a telephone interview with The PUNCH, noted that there was a supply problem.
He said, “People are no longer buying the normal quantity. Some people want to buy and keep; so, the demand has gone up artificially during this period. But at the same time, the supply is not necessarily available and then it takes time to order the fuel, maybe about six to eight weeks between your order and when it comes.
“In order to now increase supply to meet the increased demand, it is getting tight to get those cargoes because of the time of the year. Cargoes are not really available at this time of the year because this is winter period. Many refineries in the Europe, because this is not the peak driving season, they do not produce so much gasoline (petrol). So those cargoes are few and far between, and they are at a premium.’’
Oyebanji said the foreign exchange challenge, which had hampered fuel importation, was also contributing to the supply problem.
The Chairman, NUPENG, Lagos Zone, Alhaji Tokunbo Korodo, said, “For the first time in the history of Nigeria, we have an official of the government accepting governemnt’s failure. I have said it several times that they have been rationing, and it is going to linger.
“But they shouldn’t allow it to get worse beyond this current situation,” he said, adding that tanker drivers were being subjected to unnecessary workload.
“They will say, ‘Discharge one compartment at Apapa; second compartment at Agege, and the third at Abeokuta. So, the job the truck driver is supposed to do within an hour, he may end up doing it for two days.”
Korodo said the pipelines to the nation’s fuel depots were being regained gradually, adding that if the pipelines came back on stream, it would help to curb the supply challenge.
Also, manufacturers said the fuel scarcity was posing a lot of challenges to the sector.
Reacting to the admission by Kachikwu that the current fuel scarcity would persist for another two months, players in the sector said the prevailing situation had impacted negatively on productivity in the manufacturing sector.
The President, MAN, Dr. Frank Jacobs, said workers turned up late for assignment and spent more on transportation, adding that it also cost operators more to buy fuel from the black market.
Jacob believed the Central Bank of Nigeria should make foreign exchange available to marketers so they could import fuel.
He said the government should build more refineries and boost local fuel production both for consumption and export as a long term solution.
The Director-General of MAN, Mr. Remi Ogunmefun, while noting that marketers of petroleum products battled the same challenge of forex scarcity, urged the Federal Government to focus on the development of the real sector as a solution to the forex situation.
He said, “Government should concentrate on improving the real sector and the non-oil export sector so that we can export and earn enough foreign exchange to import what we need.”
In a similar vein, the Director-General of the Lagos Chamber of Commerce and Industry, Mr. Muda Yusuf, noted that the situation had a negative impact on productivity, particularly for small business owners, who needed fuel to power generators and spent more to buy from the black market.
Yusuf blamed the situation on what he called “over centralisation of the petroleum sector,” adding that deregulation would solve the problem.
He said, “Our appeal is that the government should quickly deregulate the sector completely.
“The supply of petroleum product is too centralised and the downstream sector is overregulated. Right now, the Nigerian National Petroleum Corporation accounts for about 70 per cent of the total supply.
“The current arrangement is not sustainable. If the sector is deregulated, it will solve the problem of supply. It will reduce the pressure on our foreign reserves because, right now, about 35 per cent of our forex is going to the importation of petroleum products.”