*Imposes N10m penalty on each company
12 December 2015, Lagos – The Department of Petroleum Resources (DPR), the apex regulator of Nigeria’s oil and gas industry appears to have woken up from its long years of slumber as it has suspended the importation permit of six petrol depots in Lagos and Calabar for selling Premium Motor Spirit (PMS), otherwise called petrol, above the official ex-depot price of N77.66 per litre.
The action was the first time in a decade that the organisation would apply sanctions of such magnitude on erring operators, who allegedly shortchanged Nigerians, especially during the period of crisis.
The agency has over the years demonstrated lack of capacity to regulate the depot owners, who sell products at exorbitant prices to retail outlets and has concentrated efforts in sanctioning the filling stations that sell above official prices, despite the fact that they also buy above the official prices at the depots.
But citing its powers under the Petroleum Control Act of 1967 and the Petroleum Act of 1969 (as amended), the agency in a circular with reference number PI/PAD/25/Vol.1/360 of December 11, 2015, stated that the importation permit of the six depots had been suspended for three months for selling PMS above the stipulated official price of N77.66.
In addition to the suspension, the affected depots will also pay a fine of N10 million each to the regulatory agency.
The agency listed the affected depots to include: Samon Petroleum, Calabar; Fynefield Petroleum, Calabar; Staillonaire Petroleum, Lagos; Folawiyo Petroleum, Lagos; Sahara Petroleum, Lagos; and Capital Oil, Lagos.
According to the agency, Folawiyo was sanctioned for allowing Sahara Petroleum to use its depot to breach the stipulated price.
The level of involvement of Capital Oil was not clear as the company does not import petrol but is only used by the Pipeline Products and Marketing Company (PPMC), a subsidiary of the Nigerian National Petroleum Corporation (NNPC) and other marketers to sell their imported products.
“PPPRA has been advised to revoke the companies’ allocation, while PPMC has been informed not to allocate PMS to the erring depots during their period of suspension,” said the agency.
It was reported that independent marketers and depot owners have defied the threat by the NNPC to engage the Department of State Services (DSS) and Economic and the Financial Crimes Commission (EFCC) in a renewed effort to arrest diversion of petroleum products by some unscrupulous marketers.
It was gathered that despite the threat, the marketers still divert petrol allocated to them by the PPMC at official ex-depot price of N77.60 and sell to other marketers at between N115.50 and N118 per litre.
Investigation revealed that petrol is sold at these exorbitant prices in some of the depots with NNPC products.
It was learnt that marketers with NNPC tickets buy the product at N77.60 per litre but instead of loading the product to their various filling stations, they hawk the tickets to other marketers, who do not have direct allocation from the corporation.
To check profiteering by retail outlets, the Minister of State for Petroleum, Dr. Ibe Kachikwu had directed DPR to give out to members of the public for free, petrol that is found to be hoarded in any filling station.
*Ejiofor Alike – Thisday