Arrival Of Independent Marketer's Fuel Vessel Ends NNPCL Monopoly

Independent marketer importation of the first batch of petrol, 27 million litres, has arrived in the country, putting an end to a downstream monopoly market once enjoyed by the Nigerian National Petroleum Company Limited.

Following the official end to subsidies by President Bola Tinubu on May 29, the vessel, ST Nnene was earlier billed to arrive since last week, but was held down off Lome waters due to adverse weather, arrived at Ijegun-Egba on Wednesday.

In a report gathered, ST Nnene had cost Emadeb Energy’s Chief Executive Officer, Adebowale Olujimi, and its bank partners of $17m (about N13b) to hire.

State oil firm NNPCL had enjoyed a monopoly downstream market for years as the firm had singlehanded imported petrol consumed in-country, and had dictated prices.

As of Tuesday, since the end of subsidies which cost the country about N12tn, prices of petrol had risen from an average of between N180/N200 per litre, to N614 per litre.

Olujimi while speaking at the ceremony noted that petrol importation was no longer sustainable.

According to him, “Petrol importation is not a sustainable way for a country to run. From what we saw yesterday when PMS price rose to over N600 per litre, it is an indication that the dynamics of the business is a tough one. It requires huge US dollars to bring in this. The way forward is for local refineries to be revived."

While representing the Chief Executive Officer, the Nigerian Midstream and Downstream Petroleum Regulatory Authority, Farouk Ahmed, Sadiq Bashir, pointed out that the development was an important milestone since the downstream sector was deregulated.

“This is what we have been looking forward to. When we talk about deregulation, people think it’s all about increasing prices. No. Although prices would now be determined by market dynamics, deregulation also opens up the market for other players to come in.

“Yes, we would experience teething problems at first; however, if market forces are allowed to come into play, prices would eventually go down due to high competition. We assure that NMDPRA would continue to ensure quality control of products being sold to the public," he said.

Also, the National Controller Operations, the Independent Petroleum Marketers Association of Nigeria, Mike Osatuyi, disclosed that issuing licences to independent marketers to import would give rise to competition and fairness in the downstream sector.