Deregulation: Nigeria Grants Petrol Import License to 56 Oil Marketing Firms

In furtherance of the deregulation of the downstream sector of the Nigerian oil and gas industry, the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) said it had issued licence to import petrol into the country to 56 oil marketing companies.

Chief Executive Officer of NMDPRA, Mr. Farouk Ahmed, revealed on Monday in Lagos, during a stakeholder engagement session with petroleum marketers, disclosing that 10 of the 56 firms have shown commitment to supply products from July to September 2023.

At the meeting attended by marketers belonging to the Major Oil Marketers Association of Nigeria (MOMAN) and the Depots and Petroleum Products Marketers Association of Nigeria ( DAPPMAN) as well as the Nigerian National Petroleum Company Limited (NNPC), Ahmed said the essence was to encourage the marketers to come into the market.

Ahmed added, “You know, if you recall on May 29, Mr. President said the subsidies were gone,  but we encouraged all the marketing companies who are interested in importing to come forward for licensing to import.

“So this meeting I called is to thank some of them that have taken that offer. Now, we have 56 marketing companies that applied for and obtained a license to import Premium Motor Spirit and 10 indicated their ability in the Q3, that is July to September.

“Out of those 10 again,  three of them that have already landed cargoes are Prudent Energy, AY Ashafa and Emadeb. 11Plc and others are also indicating interest to import in August and September. So it’s just to encourage them to import so that they can displace NNPC’s dominance in the market because this market is open for all to compete, and we want to encourage all the marketing companies to come in and continue their normal businesses in this arena.“

He stated that the subsidy removal had led to the drop in the country’s petrol consumption to an average of 47.3 millions liter per day (mlpd) as against 65 mlpd before subsidy eradication.

“So for the month of January we averaged 62.5mlpd, February, we had 62.1 mlpd, in March, we had the highest after the election 71.4mlpd, April 67.7mlpd, May 66.6mlpd, in June, it dropped to 49.5mlpd and as of 17th July today, we had 46.3 mlpd”, he explained.

With the liberalisation of the petrol market, he stated that end users would have more options on where to buy the products.

“The implication for the end users is that they have choice and that is the whole idea of a free market. They have a choice where they go to because if NNPC was the sole importer that means they have advantage. But we don’t want any dominant player in the market. So we thought it would be nice to give them words of encouragement and ask them if  there is any area that they need support from the regulator or the government so we can encourage them to participate”, the NMDPRA chief executive said.

Assuring consumers of the agency’s determination to ensure effective regulation and monitoring of the industry to prevent collision within the sector, Ahmed added that the regulator would continue the monitoring oversight of the industry.

He said NMDPRA was working with Federal Competition and Consumer Protection Commission (FCCPC) in terms of consumer protection to avoid a marketer getting undue advantage and shortchanging Nigerians.

“But most importantly is the quality of products coming in so that it does not affect motorists or individuals in terms of damages to equipment. We have done that and we have upgrade our Health Safety and Environment (HSE) directorate so that we can have good laboratories where we do all this things in collaboration with other stakeholders in surveillance and in the use of their labs for quality. So, our focus is to make the product available to the people”, he added.

Peter Uzoho and Oluchi Chibuzor

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