FUEL SCARCITY: FIX REFINERIES TO STOP IMPORTATION!

Fuel queues stole in like a thief in the night penultimate week. Fuel shortages are no stranger to this clime alright, but there was no inkling about this one. For one, there had not been shortages for some time. So, the average Nigerian motorists were relatively getting used to driving into preferable outlets around, filling or topping their tanks and driving out in a jiffy. But this scarcity came almost as a bolt from the blues.

Nigerians have thus been squeaking and groaning about their routine being so rudely obtruded upon. Life is fast assuming a slough for the majority of Nigerians who have had to grapple with sheer misery,  a challenge of survival that has been exacerbated in the last one year.

As they were whingeing about the impetuous removal of fuel subsidy and sudden closure of the forex windows, with the concomitantly steep rise in inflation it engendered, electricity tariff hike landed with a loud thud. The putrid smell it sluiced into the atmosphere was still being forcefully slurped down the throat when fuel queues rudely stole into the scene to heckle the routine.

It started like a child’s play but as the scarcity bit harder, fuel queues, according to reports, began to get lengthy as motorists and other fuel users thronged the filling stations across the country. In some acutely affected cities, including Lagos and the Federal Capital Territory (FCT), Abuja, queues were said to have stretched up to three kilometers by penultimate weekend!

Premium Motor Spirit (PMS), otherwise known as petrol, affects the populace more than other petroleum products like diesel and aviation fuel because it is used more by the larger population to power vehicles and generators by households and macroeconomic concerns.

The current scarcity is exerting pressure on the fragile economy already contending with the highest inflation rate in 28 years. And prices of foodstuffs are already rising in response to the fuel dislocation, adding to the people’s frustrations not long after electricity tariff was hiked for Band A consumers.

Virtually everyone is affected either as car owners, commercial drivers whose vehicles use petrol, households and small-scale business owners who need fuel to power their generators as well as commuters who rely heavily on public transportation.

Commuters are stranded at bus stops waiting for buses that are stuck in long queues at fuel outlets. Few buses that ply the roads charge astronomical fares. Many car owners have parked their cars to hop on public buses. The scarcity has frittered away savings and upstaged survival calculations.

Expectedly, fuel prices have risen above N850 per litre in major cities like Lagos and Abuja, while the prices have soared above N1,000 outside the major cities. Black marketers are having a field day selling for between N2,000 and N3,000 per litre. Only the Nigerian National Petroleum Company Limited (NNPCL) outlets are selling at an average of N617 per litre, but queues in those outlets are simply scary.

Stakeholders, including oil marketers, have been groping for the real cause of the latest scarcity. NNPCL’s spokesman, Olufemi Soleye, who accused some marketers of taking undue advantage of the situation to maximize profits, attributed the shortage to “logistics challenge,” assuring Nigerians that the oil octopus had more than 1.5 billion litres of fuel, which is enough to last 30 days.

However, in spite of the assurance by the NNPCL that the logistics challenge at the heart of the current fuel scarcity had been tackled, it is still bedlam at filling stations as queues remain lengthy, while many outlets are under lock and key. What is happening?

An operator with industry knowledge believes that  the problem is beyond logistics as the NNPCL wants the public to believe. He posits that it has to do with the fuel giant’s inability to import enough fuel at the moment. “The cause of the erratic supply,” he told a national daily, “is because the NNPCL does not have enough fuel imported. Regardless of the money or anything, the NNPCL sometimes experiences glitches in its supply…”

He added: “Wherever the NNPCL has disruptions in importation, we’ll start having these issues. They will try to manage it but it will later blow open. Last week, they said it was a result of logistics, it is about glitches in importation.”

But Soleye insists that NNPCL has enough fuel. “If there are disruptions in fuel distribution for two to three days”, he explains, “it usually takes twice that time to return to normal. The situation would improve soon. One important point to note is that we have product availability.”

The government has been making frantic efforts to tackle the fuel challenge as the scarcity bites harder. The efforts include what they call a 15-day emergency fuel supply that will ensure that the commodity circulates across the country. Vessels carrying imported fuel are berthing at the ports to discharge the product to different depots, for onward distribution to ubiquitous outlets in towns and cities across Nigeria.

The efforts are notably commendable but the ultimate solution to the vicious cycle of perennial scarcity of fuel is to put paid to importation by working consciously at meeting local demands.

It is, indeed, infernally inglorious that we are about the only major oil-producing country that imports the finished product to satisfy local consumption. And it is utterly reprehensible to be incessantly plagued by the scarcity of a product that Providence so abundantly gifts us. Ours is akin to a man who has rivers sloshing all around him but washes his hands with spittle!

It is an incubus we must find solution to. And the ultimate solution, in our view, is to muster the will and the way to fix our refineries, that are fast becoming insuperable, and hand them over to private businesses to run on our behalf. That way, not only do we meet local demands of the finished product and put paid to importation, we will be exporting to earn essential foreign exchange.

It is irrefutable that government’s running of those refineries in the past had always been disastrous. What did we find? Through a contrived regime of graft and greed, the initial promising refineries were run aground one after the other. And each time a turnaround maintenance (TAM) running into billions was carried out on them, the perfidious hands of sleaze and corruption would show up and snuff life out of them. This, in a nutshell, was why all the four refineries remained comatose for a long time and we came to shamelessly and solely depend on importation to satisfy local demands.

However, there is no point whingeing and whining at the incubus any further. It is time we tackled it head-on. And that journey has started with the ongoing rehabilitation of Port Harcourt refinery, the nation’s biggest and oldest, built in 1965. The Buhari regime began the rehabilitation in 2021 when Italy’s Marie Tecnimont was contracted at $1.5 billion.

The Tinubu government, however, revivified national brio and enthusiasm in the project. The refurbishing is promising, if it is well handled this time, because it is expected to produce cheaper fuel, jobs, boost local businesses and foster downstream industries such as petrochemicals.

The refinery has a total and full capacity of 210,000 barrels per day (pbd). The old plant, which is the one under repairs now, has 60,000 pbd, while the new plant, commissioned in 1989, has 150,000 pbd. The 60,000 pbd, when it comes on stream, is capable of meeting the current daily local consumption of fuel, which stands at 46 million litres, a 30 percent reduction from the figure of 66.7 million litres before subsidy withdrawal.

However, the rehabilitation is becoming convoluted. The rigmarole that appears to be setting in is bothersome. By the original schedule, the 60,000 pbd old plant is to completed by December, 2023, while the new 150,000 pbd plant is due to start running in the fourth quarter of this year. Truly, the Minister of State for Petroleum (Oil), Heineken Lokpobiri, on December 20, 2023, announced the “mechanical completion” and the “flare start-off” of the plant as scheduled.

The NNPCL followed up with the announcement that the test run of the plant would be completed in January, this year. This implies that it would start proper production shortly after that. But nothing happened until recently when NNPCL Group Chief Executive Officer, Mele Kyari, announced that the plant would start production by April end. But a week after, nothing has been heard again about the plant. What is really the matter?

President Bola Ahmed Tinubu should at this stage intervene decisively, as the substantive Minister of Petroleum Resources, and prevent history from being repeated. This turnaround maintenance (TAM) should not be allowed to go the way of the others. The culture of the president overseeing the oil industry, as the substantive oil minister, began with former President Muhammodu Buhari, with the overt intention of ensuring that thorny issues that may arise get expeditious presidential attention.

President Tinubu should put his presidential feet down and disallow ‘itching fingers’ from messing up this TAM, unlike in the past. Ravenous wolves whose stock in trade is to sabotage TAMs to ensure the nation continues to perpetually import fuel for their pecuniary interests must not be allowed to toy with this one.

Not only must the two phases of the rehabilitation be successfully completed, at least two other refineries must also be fixed. We must put behind us the shame of importation, conveniently meet local demands and embark on export to earn the much needed foreign exchange.

Hopefully, the $19 billion Dangote Refinery, Africa’s biggest (and the world’s largest single-train refinery), which began production of diesel and aviation fuel in January, this year, will soon start producing PMS.

The entrance of business mogul and Africa’s richest man, Aliko Dangote, has been a tremendous blessing to the oil industry. Within the short period the behemoth, commissioned on May 22, 2022, by former President  Buhari, began production, it had crashed the price of diesel thrice from N1,750 per litre to N940 and that of aviation fuel from N1,500 per litre to N980.

Certainly, when Dangote Refinery begins production of PMS and the Port Harcourt Refinery as well as the others come on stream, the intermeshing glut is bound to ease off the strains in the oil industry and lower the current suffocating inflationary morass.