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Why we back FG on petrol subsidy removal by 2022 – IPMAN, others

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• NANS rejects proposed fuel price hike, threatens shutdown

The Independent Petroleum Marketers Association of Nigeria (IPMAN)said yesterday, that its support for the Federal Government over the planned removal of subsidy on Premium Motor Spirit (PMS), stems from the realization that  the Petroleum Industry Act (PIA) signed into law by President Muhammadu Buhari on August 16 makes no provision for subsidy.

Besides, IPMAN President, Chinedu Okoronkwo, told the News Agency of Nigeria (NAN) yesterday that his association has consistently “advised the government to remove petrol subsidy because it is not in the interest of development of the downstream sector.”

But the National Association of Nigerian Students (NANS) threatened, yesterday, to shut down the country should  the Federal Government go ahead  with the planned fuel subsidy removal.

The students’ body also rejected the government’s plan to pay N5,000 transport allowance to 40 million Nigerians to cushion the effect of soaring fuel prices.

Okoronkwo, in the NAN interview, said: “We welcome the decision of the government to stop subsidising petrol by 2022 and we are hoping it will attract more investments to the sector, especially with the passage of PIA.”

He added: “What we want is that a level playing field be provided for everyone in the sector to encourage competition once the subsidy is removed.”

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Also speaking on the issue, the immediate-past President, Major Oil Marketers Association of Nigeria (MOMAN), Tunji Oyebanji, said continued subsidising of petrol was not sustainable in light of current economic realities.

He said the 2022 deadline was realistic and its impact might be mitigated with the coming on stream of the 650,000BPD Dangote Refinery, Bua Group Refinery, Waltersmith Refinery and other modular refineries.

Oyebanji, who is the Managing Director of 11 Plc, however, faulted the plan to replace the subsidy with cash transfer to Nigerians due to lack of a reliable data base in the country.

“In my personal opinion, I am of the view that such funds should be channeled to areas like education and mass transportation that would be accessible to ordinary Nigerians,” Mr Oyebanji said.

An oil and gas expert, Wilson Opuwei, said the conversation about fuel subsidy in Nigeria “should have been a thing of the past because it was an obvious wastage of the nation’s resources”.

Mr Opuwei, who is the Chief Executive Officer of Dateline Energy Services Ltd., maintained that the elite were the major beneficiaries of the fuel subsidy regime.

He said: “We should let market forces determine the price of petrol and other products, not the government dolling out subsidies with funds that we don’t even have.”

NANS rejects proposed fuel price hike, threatens shutdown 

Declaring its position on the issue yesterday, the  National Association of Nigerian Students (NANS) threatened to shut down the country should the Federal Government go ahead with the  planned fuel subsidy removal.

Addressing journalists in Abuja, NANS President, Comrade Sunday Asefon, said the union would mobilise its 41 million members across the country to protest what he branded a “strange proposal.”

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The  present economic realities in the country, Asefon  said, made it  wrong for the government to contemplate something as critical as deregulating the petroleum sector “without thinking it through, without consultation and without a robust debate.”

He described the move as a plan by the government to get money at all costs to squander and finance the ostentatious lifestyles of public officers and senior civil servants, adding that any attempt to aggravate the economic woes of Nigerians would not only be unconscionable but reckless.

“Nigerians are really suffering. We are in dire socioeconomic straits. We are weeping in our hearts and souls. We are dying in silence. We feel the agony and anguish because we are practically involved,” he said.

Continuing, he said:It will amount to testing the patience of Nigerians. And we wish to warn against it. The country is very stretched and tensed. In case the government is not aware, we are passing them this intelligence free of charge now. Again we advise: let the government not stretch it further.

“The consequences will be dire. The people are already flamed. Mendacity will beget mendacity

NANS is happy that the organised labour and civil society groups have all rejected the proposal.

”We shall ensure that the entire country is shut down and paralysed should the Federal Government proceed with its insensitive plan of deregulation, or even any further increase in the pump price of fuel. We have had enough.

”We know that neo-liberal and imperial economists will soon emerge to confuse themselves with some well- rehearsed stale analyses and commentaries.”

“It is therefore very strange that the Federal Government could contemplate the removal of fuel subsidy now. The four refineries are not functioning, and if they are functioning at all, it is at a near zero level. There is a zero consultation with stakeholders to even consider issues around deregulation and why it should or should not be. The survival of Nigerian workers and their wards is yet to be discussed, yet a date that may take lives out of them has been fixed.

”Furthermore, inflation is already passing a skyrocketing level. So we may need to find a word to describe the kind of inflation that will be experienced if the pump price of PMS goes above 200 percent. In fact, we are very convinced that the Federal Government is acting impulsively on a matter as sensitive as this. And our conviction is based on many things that cannot just add up. Beyond the issues already raised, let us consider the following economic confusions:

”In the 2022 Appropriation Bill, the FG already provided for fuel subsidies. One then wonders why it will provide for what it plans to eliminate.

”Upon which data did the Honourable Minister of Finance, Budget and National Planning determine that only 40 million Nigerians are vulnerable? And what is the definition of vulnerability in our socioeconomic context?

“Where does she intend to generate the money which will be paid to those 40 million Nigerians since there is no provision for it in the 2022 Appropriation Bill?

”Is it not a very strange economics to rob the poor to pay the poor even lower? In which economic sense or theory does 5000 the inflationary effect of 200 percent increment on the central economic item of a country?”

Asefon urged the government to rescind the plan till adequate arrangements like refining at home and utilising the nation’s petrochemical by-products are made.

”After that, there will be a robust discussion by all stakeholders to deal with associated socioeconomic issues and discuss the details of the new regime. It is only on this condition that there can be a corresponding social equilibrium, economic prosperity, job and wealth creation for Nigerians.”

Finance, Budget and National Planning Minister , Zainab Ahmed, had announced that the government would remove fuel subsidy and replace it with a monthly N5,000 transport grant to about 40 million poor Nigerians.

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Bloody clashes: Sanwo-Olu’s RTEAN ban timely, say auto journalists

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The Nigeria Auto Journalists Association (NAJA), the umbrella association of automotive reporters in Nigeria, has commended the Lagos State Governor, Babajide Sanwo-Olu, for his swift action in suspending all activities of the Road Transport Employers Association of Nigeria (RTEAN) in the state following the recent restiveness between rival members of the group in Iyana-Iba, Ojo and Lagos Island areas of the state.

Mike Ochonma, Chairman of NAJA, made the commendation in a press statement he issued after the ban on the activities of RTEAN.

The chairman of NAJA stated that the ban by his the governor became imperative to prevent further breakdown of law and order in the state.

He called for more restraint and caution from RTEAN members to allow the state government to take necessary steps that would not only restore peace and decorum from the association, but more importantly, guarantee the security of lives of defenseless Lagos commuters going about their normal business.

The governor had also announced the constitution of a 35-man caretaker committee to take over activities of the union henceforth.

Heading the committee is Sulaiman Adeshina Raji with Bamgbose Oluseyi as deputy chairman.

During the clash last Wednesday, the transport union members were seen in a trending video clip engaging themselves in a free-for-all, hauling stones, bottles, cutlasses and other dangerous weapons at each other.

Two persons were reported killed during the clash.

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Major marketers hail NNPCL’s acquisition of top downstream firm, OVH Energy

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Group Chief Executive Officer (GCEO) of NNPCL, Mallam Mele Kyari

The Major Oil Marketers Association of Nigeria (MOMAN), an umbrella body of the largest downstream oil and gas companies in the country, has congratulated the Nigerian National Petroleum Company Limited (NNPCL) on the successful acquisition of OVH Energy Marketing (OVHEM) Limited, a major downstream operator.

MOMAN in a statement issued yesterday by its Chairman and Managing Director of Ardova Plc, Mr. Olumide Adeosun, welcomed and encouraged the ongoing market consolidation geared towards bringing stability, cost and logistics optimisation in the downstream sector.
OVH is the owner and operator of the Oando- branded retail service stations across the country, and the company and NNPCL are member companies of MOMAN.

The Group Chief Executive Officer (GCEO) of NNPCL, Mallam Mele Kyari and the Chief Executive Executive Officer of OVH Energy Marketing Limited, Mr. Huub Stokman, had announced the acquisition transaction last weekend at an event held in Abuja.

However, commenting on the development, Adeosun said, “We send hearty congratulations to NNPC Retail Limited and OVH Energy Marketing Limited on the successful acquisition of OVH Energy Marketing Limited by NNPC Limited.

“Both companies are active MOMAN members who are committed to our core values of health, safety, the protection of the environment, quality, customer service, innovation, technology and compliance with international corporate governance codes.

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“MOMAN welcomes and encourages the ongoing market consolidation which will bring stability, cost and logistics optimisation, enhanced competition and best practice sharing as we progress to a deregulated market.”

Kyari had said OVH Energy’s Oando- branded retail service stations would be rebranded into the NNPCL’s brand and merged with NNPC Retail Limited with full integration scheduled to take place by the end of 2023.
Both Kyari and Stokman were, however, silent on the financial implication of the deal and what would be the fate of OVH Energy Marketing’s employees when the formal takeover takes place by 2023.

The acquisition tagged by NNPCL as ‘Acquisition for Growth’, was expected to see the national oil company become the owner of entire assets of OVH Energy Marketing, licensee of the Oando retail brand and ASPM Limited, custodians of the Lagos Midstream Jetty, also known as West Africa’s first privately owned midstream jetty.

OVH Energy boasts of distributing over one billion litres of refined petroleum products annually while ASPM Limited is focused on strengthening Nigeria’s downstream value chain through the Lagos jetty.

In the short term, the acquisition would see the NNPCL receive a jetty (ASPM) with 240,000 metric tonnes monthly capacity, eight Liquefied Petroleum Gas (LPG) plants, three lubes blending plants, three aviation depots and 12 warehouses.

The deal would also bring over 380 additional filling stations under NNPCL retail brand in Nigeria and Togo, on its journey to attaining 1,500 stations, making it the largest petroleum product retail network in Africa.
OVH’s expertise spans the provision of jetty services and the marketing and distribution of refined petroleum products for retail, commercial and industrial purposes.

The NNPCL GCEO had explained that the strategic move was aimed to create the leading downstream energy company in Nigeria and West Africa, driven by operational efficiency, best-in-class management, and physical infrastructure while offering premium petroleum products and related services to customers, in line with global standards.

Through this acquisition, he said the NNPC Retail Limited would build on the existing success of OVH Energy and operate model service outlets leveraging OVH’s extensive asset base and commercial capabilities.

Kyari further stated that the NNPCL was bringing to the table, its 45 years of experience and strong capability to bear on the management of the facilities.He maintained that securing the country against energy poverty would mean access to petroleum products in addition to managing the energy transition, which he said has become a reality.

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NMDPRA seals 16 gas plants, arrests five suspects in Edo

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The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has sealed 16 illegal gas facilities in Edo State.

Some filling stations were also sealed over an alleged breach of rules and regulations.
The agency arrested five suspects during the exercise.
The agency’s state comptroller, Ebi Ogionwo, said the clampdown was to curb the activities of illegal and unlicensed oil and gas operators in the state.
He alleged that some misguided operators were setting up oil and gas facilities in areas not suitable for the business and without necessary approval from the agency.
Ogionwo said, “It is an offence for anyone to site such facilities without due approval from the NMDPRA. The agency is out to bring sanity to the operations of midstream and downstream petroleum business in the state.”

He further warned investors against taking laws into their hands by setting up gas and petroleum facilities in areas not approved by the agency.

Ogionwo said five suspects arrested during the exercise would be charged to court.

“There are laws, guidelines and regulations that people must follow before setting up oil and gas facilities. So, the purpose of the operations is also to check the level of compliance by those who have set up these facilities in the state and take necessary actions that are required,” he said.

Ogionwo added that the illegal operations of oil and gas facilities compromised the safety of lives, property, environment as well as deprived both the state and Federal Governments of the revenue that should accrue to them through taxes and other sources.

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