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PPMC Places Order for Shiploads of Petrol

By on March 27, 2011

Ahead of the April general elections, the Pipelines and Products Marketing Company (PPMC), a subsidiary of the Nigerian National Petroleum Corporation (NNPC), has placed orders for delivery of shiploads of petrol to the market.

Also, major and independent oil marketers have received directives from the Petroleum Products Pricing Regulatory Authority (PPPRA) to begin processing relevant documents for the first quarter petrol importation, pending the release of import licences by Friday this week.

Although the total import orders by both the PPMC and other marketers could not be ascertained at press time, THISDAY gathered that marketers were directed to process their imports documents based on the fourth quarter allocation figures, as what they are likely to get this first quarter might not be anything less.

Between 15 and 20 gasoline cargoes were imported by the PPMC last December. Executive Secretary of Major Oil Marketers Association of Nigeria (MOMAN), Mr. Femi Olawore, as well as a top executive of Jetty and Petroleum Tank
Farm Owners of Nigeria (JEPTFON) confirmed Tuesday that import permits would be released to marketers this week.

THISDAY learnt that based on the directives, oil marketers have commenced discussions with their banks for Letters of Credit, as processing of import document takes not less than three weeks.

Marketers had been expressing concern about the delay in the issuance of licences for the supply of fuel for the first quarter, pointing out that the period is very crucial because of the forthcoming general election, which will necessitate increase in movements. They expressed fear that fuel crisis at such critical period could disrupt the exercise.

Olawore said import licences ought to have been released in March, as the processing of import documents entail obtaining clearances from both the PPMC, PPPRA, and other relevant agencies before approaching their banks for Letter of Credit to import, which takes about two weeks.

He said these processes take not less than three weeks to complete and advised that the PPPRA should ensure that licence permits are issued at least six weeks ahead.

He however ruled out any fuel crisis during the election period, noting that some marketers are yet to exhaust their fourth quarter allocations,
while others are just bringing in their own products. Besides, he said the PPMC has some petrol in store to augment what other marketers would supply.

Oil marketers  had  last year alleged lack of transparency in the allocation of petroleum product import for the second and third quarters of 2010. Specifically, the marketers, mainly members of JEPTFON, allegedthat PPPRA was not transparent in the handling and administration of the newly introduced Sovereign Debt Instrument, adding that the Federal Government had paid outbillions of naira to ‘brief case companies’ as imports subsidy on the recommendations of the PPPRA.

They further noted that the allocation for the second and third quarters of last year was marred in secrecy and urged thatthe agency be compelledto make public details of the companies that benefited from both the 2nd and the 3rd quarter import allocations, including the full list of those companies, their installed capacities, quantity of products applied for, quantity approved, date of importation, port of discharge, vessel name, quantity imported, Naval/DPR clearance of such vessel, country of origin as well as names of the
promoters of such companies.

The PPPRA however denied these allegations and stated that petroleum import licences were  issued to marketers  based on some criteria, which included; historical supply performance, quantity of products requested and capital
investment base.

However, the matter, which lingered for weeks, resulting in petrol scarcity was laid to rest in August last year, after a peace meeting that was convened by the Secretary to the Government of the Federation, Alhaji Ahmed Yayale and the Minister of Employment, Labour and Productivity.

A Memorandum of Understanding (MoU)issue d at the end of the meeting, which had in attendance,the PPPRA top brass ,leadership of the National Union of Petroleum and Natural Gas (NUPENG, and JEPTFON resolved that JEPTFON should be should be granted recognition as a stakeholder in the downstream sector of the oil and gas industry and should also be considered in the issuance of product allocation for
import in an equitable manner. It wasalso resolved that the issuance of product allocation for participation under the Petroleum Support Fund scheme, should strictly be in line with the PSF guidelines.

The PSF provides among others; that, only companies that are registered as oil marketing companies with the Corporate Affairs Commission; those with proof of ownership of storage facilities of 5,000 MT for a particular product as well as dispensing facilities (retail outlet network); and companies with the ability to finance a minimum cargo of 5,000 MT of product, are eligible to draw from the fund.

Source : Thisday