The Federal Government is holding meetings with midstream and downstream oil industry players as part of initiatives to build strategic supplies of Premium Motor Spirit, also known as gasoline, in crucial sites across the nation.
It also announced the formation of a 14-person committee to identify a long-term solution to the disruptions in the supply and distribution of petroleum products. It claimed that the national strategic stocks will aid in alleviating the ongoing fuel shortage in Nigeria.
On Tuesday in Abuja during the ongoing stakeholders’ consultation session on midstream and downstream petroleum laws, Ogbugo Ukoha, Executive Director, Distribution Systems, Storage and Retailing Infrastructure, revealed this regarding the strategic stock.
Speaking on the sidelines of the event, he said that the National Strategic Stock Regulations was one of the eight draft regulations that the authority had put together. He added that the NMDPRA and stakeholders were reviewing them.
He said, “Section 181 of the PIA (Petroleum Industry Act) compels us to develop strategic stock. On the supply issues that we usually have, recall that a few weeks ago, there was flooding in Lokoja and Bayelsa, and supplies were impacted negatively.
“We should have strategic stock across the country. And there are storage everywhere, even though pipelines need to be revamped. So this strategic stock regulations addresses that need, and it is a priority.”
Ukoha added, “It takes three to four days for trucks from the coastal areas to get here (Abuja), and if something happens on the road, then you will see how it will impact on the supplies in the Federal Capital Territory.
“On Friday, we had to go to Niger State, where three trucks fell across the Bida-Lapai and Agae road. We were there to make sure that those trucks were cleared. But with the strategic stock, most of that will be addressed. If you have that kind of issue, you’ll just recall some volumes from the nearest storage. So these are very important draft regulations that the authority is putting forward.”
The midstream and downstream parts of the sector held highly vital positions in the industry, according to the NMDPRA official, and the regulations being issued by the authority were crucial.
“If you look at this third batch of draft regulations we are considering, there are eight of them and almost all of them speak to a particular aspect in the value chain,” he stated.
He continued, “There is a draft regulation on gas flare. You know that with the flares, it is not just to reduce or eliminate environmental hazards, but also to optimise them into power and also the revenues that are there.
“There is also, and within this eight, the draft regulation that will address penalties and enforcements. You can see how the situation is currently, that the authority, in the last few weeks, has sealed seven depots for over-pricing.
“So it is important that operators are mindful of consequences, and these regulations will give us further bite to enable us to enforce the rules we make in the industry.”
On what could be delaying the draft regulations from becoming laws, considering their importance to the oil sector, Ukoha explained that they must follow laid down processes.
He said, “There are processes. First of all, one of these processes is defined by the authority. The PIA is clear, we draft, we propose to the public and put it out for 21 days to get feedback from the public.
Meanwhile, Ukoha warned that the authority would suspend the licences of depot owners who persistently flout the government’s order on PMS pricing.
According to the Federal Ministry of Petroleum Resources, President Major General Muhammadu Buhari (retired) has given his blessing for the formation of a 14-member Steering Committee on Petroleum Products Supply and Distribution Management, which he would personally chair.
The move, according to the ministry, was made in an effort to find a long-term solution to the nationwide supply and distribution problems with petroleum products.
It was stated that Chief Timipre Sylva, Minister of State for Petroleum Resources, served as the committee’s alternate chairman in order to oversee the effective and transparent supply and distribution of petroleum products.
“Other terms of reference are to ensure national strategic stock management, visibility on the NNPC Limited refineries rehabilitation programme and ensure end-to-end tracking of petroleum products, especial PMS, to ascertain daily national consumption and eliminate smuggling,” the FMPR stated in a statement.
Sylva instructed the NMDPRA to make sure that the government-approved ex-depot and retail prices for PMS are strictly followed in order to ensure sanity in the supply and distribution across the value chain.
According to the ministry, the committee also consists of the Minister of Finance, the Permanent Secretary of the Ministry of Petroleum Resources, the President’s National Economic Adviser, and the Director-General of the Department of State Services.
Others include the Comptroller-General, Nigerian Customs Service; Chairman, Economic and Financial Crimes Commission; and Commandant-General, Nigerian Security and Civil Defence Corps.
The Chief Executive, NMDPRA; Governor, Central Bank of Nigeria; Group Chief Executive Officer, NNPC Limited; Special Advisor (Special Duties) to the HMSPR; were also listed as members of the committee, while the Technical Advisor (Midstream) to the HMSPR would serve as secretary.
