PIB: Uncertainty over Petroleum Equalisation Fund

Oil marketers at the weekend expressed uncertainty over the role of the Petroleum Equalisation Fund Management Board after the enactment into law of the proposed Petroleum Industry Bill.

The confusion over the future role of the fund came on the heels of the continued pressure on the federal government for the passage of PIB as a solution to the myriad of problems in the nation’s oil and gas industry.

Former Minister of State for Petroleum Resources, Odein Ajumogobia had insisted that the PEFMB would continue to play its role in a deregulated downstream sector.

However, the umbrella body for oil marketers argued last week that the place of PEFMB once the Petroleum Industry Act is passed is uncertain.

Chairman of Independent Petroleum Marketing Association of Nigeria in the south, Mr. Olumide Ogunmade, said it is difficult for any individual to make a clear statement on the role of PEFMB in petroleum bridging until after the enactment of the PIB.

“This is because the PEFMB will have no role to play under the new dispensation, which means marketers can sell their products at a given price,” he said.

Ogunmade, however, said marketers had no objection to “Project Aquila” introduced by PEFMB to monitor petroleum bridging among marketers in the mean time.

“For now, we don’t have choice in as much as it does not affect us and the objective is to ensure that marketers take the products to their destinations.”

PEFMB is a parastatal under the Ministry of Petroleum Resources, established by the PEFMB Act to equalise the cost of transporting petroleum products from depots to marketers’ sales outlets (filling stations) nationwide.

This is to ensure that petroleum products are sold at uniform prices throughout the country. The fund, which derives its main source from the net surplus revenue recovered from oil marketing companies, is utilised for the reimbursement of petroleum products
marketing companies for any losses incurred by them solely and exclusively as a result of sale, by them, of petroleum products at uniform prices throughout the country.

Source : Thisday