Abuja — Top government officials in charge of the oil industry refused yesterday to say when the full deregulation policy of the downstream oil sector will take place, saying they were still in consultations to try to build a national consensus around the policy.

Minister of State for Petroleum Dr. Odein Ajumugobia, who addressed newspaper editors in Abuja, said while the government is totally committed to the deregulation policy, it must still listen to stakeholders because "some people oppose government policies for very good reasons. Some say, why don't you address the issue of infrastructure before you deregulate? We are addressing that issue; a lot of work is being done to fix the damaged pipelines and restart the refineries, so that we can again produce refined products locally."

He said the present fuel subsidy regime, amounting to about N750 billion annually, is mostly cornered by "a few individuals who go round to collect another 30, 40 or 50 naira per litre from the government after selling fuel at N65." He said the government will not do a phased deregulation this time because that was what was done with gradual increase in fuel prices over the years. He said "while with every price increase you reduce the inefficiency, you have not eliminated it, hence the problem continues." He also said it is unfair to compare Nigeria to Angola, which now produces 1.9 barrels of oil, more than Nigeria's 1.6 million barrels. Its government can afford fuel subsidies there because its population is small, he said.

Nigeria National Petroleum Corporation's [NNPC] Group Managing Director Mohamed Bello Barkindo, spoke at length about the corporation's constraints in policing fuel marketers since it was made to divest its controlling interest in three major marketers in the 1990s. He said once a marketer pays for and collects fuel from PPMC, there is no effective way on controlling what he does with it because neither NNPC nor the Department of Petroleum Resources [DPR] can police all 15,000 filling stations in Nigeria or monitor the fuel 950 trucks that leave Lagos for the various parts of the country everyday.

Barkindo said both Warri and Kaduna Refineries would resume work this month when work on the damaged Escravos-Warri pipeline is completed. He said the NNPC sought the assistance of the Defence Ministry to deploy soldiers to guard three critical pipeline routes, Atlas Cove-Mosimi, Port Harcourt-Aba and Warri-Benin pipelines. He said the corporation had to buy speed boats and trucks and meet other costs entailed by the military operations.

Managing Director of the Pipelines and Products Marketing Company [PPMC] Mr. Reginald Stanley said the current fuel distribution glitch being experienced in the country was caused by marketers who believed that full deregulation would take off on November 1. As a result, he said, major marketers locked up their depots in the name of month-end audit, while independent marketers took truckloads of fuel and hid it in farms. Those that took it to stations, he said, often served with one nozzle.

Stanley also said "the date of the take off of deregulation must be managed with sensitivity because the price differential is real. We will be moving from N65 per litre to Delta price. The price will go up but it will later come down because inefficiencies in the distribution system will all be eliminated. A marketer can no longer make a quick profit from fuel; he must go for volume."