You seem to have successfully ended fuel scarcity in Nigeria and assured Nigerians that such things will not happen again under your watch. What are the strategies you’re putting in place?
I must start by thanking President Muhammadu Buhari for understanding the environment and for his commitment to see that petroleum products are supplied at the right price to every Nigerian. His feeling is that Nigerians need not pay for petrol above the N145/litre fixed price. Of course we made it quite clear to him that the products, since we are relying on importation, landing prices are much higher than the N145/l but he said that NNPC would be supported in ensuring that the product is sold at N145/l and he made the facilities available for us to make sure that is done.
As you know, the issues arrowed from two fronts; one, the oil marketers speculating that there is going to be an increase in the price of petrol in line with export parity and that would have raised the prices, so they started hoarding – not distributing the products they have. We have to bring in a lot more products and push it into the market.
The second aspect is that because they are not participating in importation, we have to make up the volume. So for the 15 million litres per day they used to import, that is about 30 percent of the total requirements had to be augmented into the system. So in the early part of 2018 – around middle of January – we had a reserve as low as 14-day supply sufficiency and that is when the president stepped in and gave us the facility to enable us bring in more product.
As I am talking to you now, we have some 50 million litres a day supply or 35-day supply sufficiency. The basic thing is, we look at what the demand is and also at what is being taken and then make sure that we have sufficient product that will supply the demand. We built the models, fine-tuned them and continuously monitor the markets. As I speak to you I know exactly what we are trucking out on daily basis from various depots and as such we know how much we are to bring in.
We take the consumption or the truck-out on daily basis and we average that over a period; we do this on a 30-day average and we know what our truck-out average is and on that basis we ensure that we plan and have at least 30-day sufficiency. These are some of the strategies. Of course, I don’t need to go into details.
What about the issue of marketers hoarding products at their farm tanks. Has it been resolved?
Yes, it has been resolved to some extent, because by the time we flooded the market with products, the hoarding was no longer attractive to them and if their plan was to wait for product scarcity or price increase, we have told them Mr. President has said clearly that there is going to be no price increase. So they brought out the product. I could remember when the product supply was at its peak, two months ago, some of them started bring out the product and selling at subsidised rate, at about N140 a litre. They are paying the cost of financing from the banks and they needed to pay the banks.
What is your vision for a newer and better NNPC?
The vision I have for the NNPC is for it to be able to play in the market. What I mean by that is to run purely on commercial terms and as much as possible if it is going to give any service to the government or to the citizens, it should give it as professionally as possible. Also, to ensure that it gets its independence and run as any profit-oriented organization. That is my vision.
What legacy would you like to leave?
The legacy I want to leave behind is to have an NNPC that has all the structures in place, with the right people that can go into the world, operate and compete across all the value-chain in our upstream, downstream and midstream operations. (Daily Trust)
