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Fuel import: NNPC mulls N266.5bn spending in 20 days

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Fuel import: NNPC mulls N266.5bn spending in 20 days

…to import 100m litres of PMS daily

 

The Nigerian National Petroleum Corporation (NNPC) has declared its readiness to import two billion litres of Premium Motor Spirit (PMS) also known as petrol for the remaining 20 days in February. The plan, checks by New Telegraph showed, will surge the state-owned corporation’s spending on fuel imports to N266.48 billion based on N133.24 ex-depot price. Giving out details of its imports schedule for February, NNPC yesterday stated that it had programmed to bring in two cargoes of petrol per day for the rest of February 2018 to boost supply.

The imports programme, it said in a statement issued by the Group General Manager, Group Public Affairs Division, Ndu Ughamadu, was “in a bid to keep the country wet with petrol and eradicate the fuel queues that have resurfaced in some cities.” Each of the two cargoes, the schedule showed, “is 50 million litres, making a total of 100 million litres that will be brought in per day for the rest of February to increase supply and replenish strategic reserves.” This amounts to two billion litres in 20 days.

The arrangement will gulp over N266.48 billion in imports spending for the two billion litres based on N133.24 ex-depot price. The NNPC’s statement added that to enhance supply, 45 million litres of petrol was discharged from ships into jetties across the country yesterday.

“Prior to the fresh 45 million litres discharge, there was 324 million litres of petrol on land and 432 million litres in marine storage, making a total of 756 million litres, enough to last for 22 days at 35 million daily consumption rate,” the statement read.

The jetties that received the 45 million litres shipments, Ughamadu said, include Nacj, Apapa; Bop, Apapa; Techo Jetty, Lagos; Dutchess, Oghara; Vine Jetty, Calabar; Chipet Jetty, Lagos; and ECM Jetty, Calabar. “To ensure efficient distribution of the product to depots in the hinterland, the Nigerian Pipeline and Storage Company (NPSC), a midstream subsidiary of the NNPC, has been mandated to fix relevant pipelines to facilitate seamless pumping, in addition to massive trucking arrangement that is in place.

“The corporation assures that with the measures in place, the fuel queues being experienced in some cities would soon be a thing of the past,” the statement added. Though the NNPC earlier insisted that the new cost of oil at the international market would not lead to hike in pump price of fuel, it confirmed the increase in daily truck out and extra cost through its Group Managing Director of the NNPC, Dr. Maikanti Baru. Baru said that it now cost N171.40 per litre to import petrol into the country. Using the approved template of the Petroleum Products Pricing Regulatory Agency (PPPRA), the total landing cost in December 2017, when Dr. Baru opened up on the higher fuel price, amounts to N185.70 with the addition of the N14.30 per litre distribution margin approved in the last pricing template for petrol by the PPPRA. Oil sold for an average of $57 per barrel in December 2017. This implies that the government is subsidising petrol consumption by as much as N40.70 per litre.

The higher price of $69 per barrel for crude at the international market showed that over N190 is spent on total cost of one litre of fuel imported into the country. Based on N185.70 total price hinted by NNPC’s GMD as at last December, over N371.4 billion (N266.48 billion and N81.4 billion subsidy) would be the total cost on two billion litres scheduled to be imported in the remaining 20 days of February. This includes about N81.4 billion (N40.70 per litre on two billion litres) cost on fuel subsidy during the period.

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