24 March 2016

Nigeria: Why Fuel Scarcity May Linger Till May - Kachikwu

Photo: Shell
(file photo).

Minister of state for petroleum resources, Dr Ibe Kachikwu, has disclosed that the lingering fuel scarcity being experienced in all parts of the country may last for the next two months.

He, however, said he is working round the clock to ensure that the fuel queues disappear and pleaded with Nigerians to be patient.

Dr Kachikwu made this disclosure yesterday after a closed-door meeting between President Muhammadu Buhari and the national president of Nigeria Union of Petroleum and Natural Gas Workers (NUPENG), Igwe Achese, and president of Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN), Comrade Olabode Francis Johnson, at the Presidential Villa.

The minister explained that NNPC had moved from a 50 per cent importer of products to basically a 100 per cent importer, adding that the 445 barrels allocated to it was to cover between 50 and 55 percent importation; so, according to him, it quite a huge feat that the country even has the current amount of the product at the stations.

Asked specifically when the queues will disappear, he said, "One of the trainings I did not receive is that of a magician, but I am working very hard to ensure some of these issues go away.

"And let's be honest, for the five six months we have been here, NNPC has moved from a 50 per cent importer of products to basically a 100 per cent importer. And the 445 barrels that were allocated was to cover between 50 and 55 percent importation. So it is quite frankly sheer magic that we even have the amount of products at the stations.

"We are looking to see how to get foreign exchange input. The president and I discussed extensively on how to get more crude directed at importation. His Excellency will rather have less crude but have individuals in the society suffer less with inconveniences than have more crude and have them continue to suffer.

"So we are going to put a new model to enable us increase the pace and actually get majors as part of the crew of those to bring in more products so that the NNPC will sort of go back on the capacity of what it used to do and the majors will take over the balance of importation.

"I think if we do that although I don't want to put a time frame but I will expect that over the next two months. Of course you are aware the DSAP programme begins in April so over the next two months we should see quite frankly a complete elimination of this.

"Our strategy is that whatever is produced in the refineries will not go for sale, we are going to keep them in strategic reserve. Because the key problem here is that there is no reserve anytime there is gap in supply it goes off. So we are going to dedicate the next couple of months to moving all the products that we produce to strategic reserve so that we can pile up reserves in the nation and that will push up the reserves in the nation.

"Believe me this is giving me and my time sleepless nights and we are working on it and we are committed to making this go away, Nigerians should please bear with us.

On the meeting with President Buhari, he said It was basically to review the oil industry some of the concerns areas that he himself is trying to find joint solutions and share thoughts.

According to him, Like you know his excellency has too many constituencies first will be politics,second army and the third will be the oil industry so matter of this nature touches his heart very much. And this is the first opportunity that the unions have had to spend a bit of time with him as a father. So we shared thoughts, areas of concerns and some solution potentials and agreed to collaborate and work together.

Asked on the concerns of the industry, he said," I will probably highlight a few ares of concerns. The PIB, the union wants us to obviously work harder than we do and try to get the PIB passed as soon as possible.

He said the unions expressed worry over the fuel scarcity issue and want a long time solutions to finally resolve this issue adding that they are also worried about the refineries and are thankful the government didn't sell the refineries without looking to work collaboratively with them to see how to make the refineries work.

"They are worried about the utilization of depots and how best to do that, they are worried about all kinds of logistics issues that plague the oil industry. They are worried about job loss in the sector arising from the position of majors who feel that the economy is giving rough end of the sticks and then try to whittle down staff.

"And so we are going to be working with the oil majors to ensure that we do not experience the kind of job loss that we are hearing has the potential to occur in the sector."

Kachikwu expressed confidence that the president was willing to work together with them to bring good jobs, tasking them, as agents of change within the respective areas where they work, to ensure that they continue to look out, contribute, take on the change on its head and make it happen also, and for recognising the difficulties this government had inherited.

"A lot of these problems that are on the table were quite frankly there when we came and we are doing the best we can to try and work on them, but we are looking to work collaboratively; those were the assurances."

On their meeting with President Buhari, NUPENG president, Igwe Achese, said: "We had a successful meeting, quite interesting in terms of the emotional attachment of Mr. President on the issue of oil and gas sector and the challenges we are facing as a nation.

"We tabled the issue of fuel scarcity, the quick passage of the PIB and to see how the sector can bounce back economically and to make Nigerians smile again. Clearly we talked more on the corruption in the oil and gas sector, products allocations. Mr. President has assured that both NUPENG and PENGASSAN will continue to be part of the restructuring that he is going to make, to look into these issues and to make sure that scarcity is reversed at our filling stations."

On his part, his PENGASSAN counterpart, Comrade Johnson, said: "We had a very successful meeting with the C-in-C and one of the highlights of the meeting was when he said he created the NNPC and he is emotionally attached to it, and that everything that is going to happen in NNPC must follow due process. He said he is concerned about what Nigerians are going through and he bears their pain and whatever he is going to do, he will do it with their support so that Nigerians can enjoy the benefits of NNPC.

"As leaders we are very satisfied with what he said, the commitment and the passion he has shown for the industry. PIB is an executive bill, he said all the legal framework will be addressed so that it will be of benefit of Nigerians. He also showed concern for pipeline vandalism and crude oil theft and we know that, with support and collaboration, he is going to achieve results."

Nigeria will push for output freeze at April Doha meeting

The minister of state for Petroleum, Mr Ibe Kachkwu has said that members of Organisation of the Petroleum Exporting Countries (OPEC) will push for a supply freeze at the Doha meeting holding on April 17.

Speaking in Abuja yesterday, the minister said Nigeria would ensure that members reached an output freeze the meeting.

According to Kachikwu, a supply freeze agreement was possible even if Iran failed to attend next month meeting, adding that it would take the oil producing country quite some time to revamp its oil production.

"We are likely to see Iran not signing on," he said. "But we have all decided that if they don't we will proceed because we do not believe that currently their entry into the market will create too much of a threat for the next year.

"I expect that we will reach a conclusion on stabilisation, stabilise current production as of January," Kachikwu said.

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