*Refinery’s ex-depot price may hit N1200/litre
*Nigerians groan amid govt insensitivity, insecurity, hardship
The Nigerian National Petroleum Company Limited (NNPC) Tuesday raised the pump price of petrol to N897 per litre from the official price of N617, with filling stations selling for N950 per litre, heightening the frustration of Nigerians about a brighter future.
The hike in the price of petrol was made as hopes by Nigerians for cheaper petrol from Dangote Refinery was completely dashed by the revelation by the owner of the refinery and Africa’s biggest industrialist, Alhaji Aliko Dangote, that only the Nigeria National Petroleum Company Limited (NNPCL) would offtake his refinery’s petrol.
Experts in the downstream sector of the petroleum sector have stated that Dangote’s decision to sell exclusively to NNPCL was due to the realization that high prices and other import restrictions may have made independent marketers uncomfortable with buying from his refinery.
They argue that only NNPCL has the capacity to buy at exorbitant prices from Dangote and be able to “under recover” or subsidize the product before selling to marketers, as being projected to Nigerians without details on the actual cost of production provided.
“Petrol from Dangote Refinery is definitely going to cost more than the ones imported from other parts of the world.
“I’m sure they know that none of us is going to patronize the refinery, reason they’re selling exclusively to the NNPCL,” a major marketer stated.
Another independent marketer noted that the oligopoly in the Petroleum sector would be worse than what currently obtains in the cement, power, transportation and food produce sectors.
According to him, in as much as the Nigerian government would continue to run a government and economics of “the cabal”, so long would mindless individuals call the shots from the shadows and stifle the common people, while smiling to the banks with money made through illicit sources and efforts.
However, addressing a press conference Tuesday in Lagos, Aliko Dangote promised that his petrol would hit the streets in “48 hours”, but was quick to add that the deal would depend on how fast he concludes talks with NNPCL.
“Our PMS (Premium Motor Spirit) can be in filling stations within the next 48 hours depending on NNPCL,” said Dangote.
He, however refused to comment on how much his petrol would cost, pushing the matter back to the Nigerian government.
“It is an arrangement which is designed and approved by the Federal Executive Council led by His Excellency, President Bola Ahmed Tinubu.
“As soon as it is finalised, which he (Tinubu) is pushing, once we finish with NNPC, it can be today, it can be tomorrow, we are ready to roll into the market.”
Also speaking to Reuters, Devakumar Edwin, a vice president at Dangote Industries Limited, further shifted the goal post when he said the refinery was testing the product (petrol) and would begin selling as soon as they are done with the testing.
Edwin reiterated Dangote’s position that only NNPC Ltd, Nigeria’s sole importer of Petroleum products, would offtake its gasoline exclusively.
“If no one is buying it, we will export it as we have been exporting our aviation jet fuel and diesel,” Edwin stated.
Some major marketers who spoke to our reporters said they were amused that some Nigerians expected Dangote petrol to be cheaper.
“To begin with, they seem to forget that Dangote is a businessman, not the Red Cross. His primary motive for building the refinery is, of course, to make profit, not to make Nigerians happy. He is no Father Christmas and nobody can dictate to him.
“Even politicians elected to satisfy the needs of Nigerians have not done that, let alone a private businessman,” noted one marketer.
According to the marketer, “Nigerians seem to forget that Dangote borrowed and is still borrowing billions of US dollars on the refinery and other businesses, which he has to repay.
“When President Tinubu ordered NNPCL to alllow Dangote pay for crude oil in Naira, many people rejoiced, forgetting that being on Lekki Free Trade Zone, Dangote Refinery, legally speaking, is not on the Nigerian soil.
“They don’t seem to understand that, under the Free Trade Zone Act, buying petrol from Dangote won’t be different from buying from Australia or from any other part of the world.
“This is because to buy from Dangote, we, as marketers, have to fulfill all the conditions required for importation, including Form M and bill of ladding.
“The same persons opposing cattle ranching on the ground that it is personal business, are falling over themselves to pressure the Nigerian government into supporting Dangote refinery as if it is a public company owned by Nigerians.
“Recall that Dangote thanked President Tinubu for ordering NNPCL to sell crude oil to his refinery in Naira. The bugging question is, why is Dangote exporting finished products, and earning forex?
“Since Nigerians put him first, why isn’t he reciprocating the gesture by selling to local marketers? Why is he waiting for the federal government to help him fix his price? This isn’t how to show patriotism to a country that has done so much for you,” stated the marketer.
Dangote also argued that the introduction of Naira-for-crude will reduce the demand for foreign exchange by over 40 per cent and free forex for other uses which he believes will impact positively on the economy.
“I want to thank President Bola Tinubu for creating this idea of Naira-for-crude and Naira-for-the-product. Doing that will give a lot of stability to the Naira and remove 40 per cent of the demand for dollars. That’s not just it, there is a lot of round tripping,” he stated.
He added that it would become possible to track loaded trucks, but said nothing about tracking ships loaded with crude oil which has remained a sore point on the management of Nigeria’s economy.
Nigeria Export Processing Zones Act LFN 2004 Form “M”. Bill of lading. Section 8 of the Act, “approves that enterprises operating within a Free Zone shall be exempted from all Federal, Government and State taxes, rates and levies”.
Free Trade Zones or Free Zones in Nigeria are also called Export Processing Zones (EPZs). These free zones (FZs) are different from other economic zones within the country. You can import, manufacture, and re-export goods in these zones without facing any tariffs and customs regulations.
The life span of a Form M is 180 days (for general merchandise) and 365 days (for plant and machinery), after which an extension of 180 days (for general merchandise) and 365 days (for plant and machinery) can be granted on the Form M by the Authorized Dealer. Any further extension has to be approved by the Central Bank of Nigeria (CBN).
It is therefore mandatory for all importers to complete and register Form ‘M’ with Authorized Dealers at the time of placing orders whether the transaction is valid for foreign exchange or not. This is currently initiated electronically on Trade Portal provided by the Central Bank of Nigeria in conjunction with the Nigeria Customs Service.
Tuesday evening, filling stations across the country made upward adjustments on their dispensing pumps with some marketers selling fuel as high as N2,300 per liter in some places.
Motorists who feel that NNPCL accredited filling stations would continue to dispense fuel at N617 per liter were disappointed when the station managers locked their gates and adjusted their prices to N897 and above in some places. Some of those filling stations were even undercutting their customers by under delivery due to poor governance systems in weight and measure systems.
As at Tuesday night, vehicle owners had blocked roads around all NNPCL accredited filling stations hoping to buy fuel at the immediate old prices, only to be disappointed at the dispensing pumps.
The independent marketers had a field day as they not only adjusted their pump prices arbitrarily but had a field day supplying their black market outlets, who sold such products at cutthroat prices to motorists, even right opposite the NNPC headquarters in Abuja.
Consequently, motorists experienced unexpected fare hike across the country, with traders quickly adjusting prices of their goods upward.
The nationwide anger on hunger and hardships got worse, especially as government decided to criminalise protests or holding of opinions on such issues as treasonable felony, punishable as capital offence.
In Niger State, reports had it that some frustrated persons under the guide of illegal miners started smashing the windows, doors and vehicle of people, vandalizing and looting their victims property and even inflicting injuries on those who dated challenge them.
Recall that #Endbadgovernance protests had led to the looting of public offices and private property in Kaduna, Kano, Niger, Sokoto, Zamfara, Borno, Yobe, Lagos and some other states.
Criminals and bandits have also successfully captured and looted the armory and armoured personnel carriers and tanks of the military in Zamfara state, leaving Nigerians in greater fears and trepidation.
