Downstream sector is not fully deregulated – MOMAN

The Major Oil Marketers Association of Nigeria (MOMAN) on Tuesday said that the downstream sector of the oil and gas have not witnessed full deregulation, which posed serious challenge to marketers.

Obafemi Olawore, Executive Secretary, MOMAN said this on the sideline of  the official re-commissioning  of storage tanks at Mosinmi depot  by the Group Managing Director, NNPC in Ogun State.

Olawore called on the Federal Government to fully deregulate the downstream sector to enable more investments, which is expected to push down the current price of Premium Motor Spirit (PMS).

According to him, the fact that the government has not fully deregulate the downstream sector, but only succeeded in adjusting the pump price upward.

“The truth is that NNPC is currently importing more than anybody because they have easier access to foreign exchange than anybody. So I cannot say for sure, but our intention is, once the sector is fully deregulated.

“ The downstream has not deregulated, they only increased the price which is not deregulation.

“You do not deregulate with fixed prices, you allow the prices to float even though we are seeing some measure of floating of the prices with some people selling below N145.

“ You can test and confirm if the quantity delivered and the qualities delivered are satisfactory. I do not know yet, DPR has to do that and the press men can go to outlet and see whether you will buy fuel that will knock your hands,’’ he said.

Olawore said that market forces like issues of accessing forex, fluctuation in crude oil prices and rising importation cost should be allowed to determine the cost of petrol as obtained in a truly deregulated sector.

He said that this would engender competition among marketers. “Foreign exchange is a challenge; there is no doubt about that, but people will import. It is their business, and they won’t want their business to collapse.

The MOMAN scribe commended government for partially deregulating the downstream segment of the oil industry, but maintained that marketers would prefer a fully deregulated sector.

He said that the current petrol price regime was a sign that the sector might be fully deregulated in the near future.

“What has happened is price adjustment, which they called appropriate pricing. What we have now is a step towards deregulation.

“ Deregulation is actually the end point; we are in the process and we will get there.

“When we get to deregulation, you will have the refining process included. As it is now, we are looking at only the petrol import side,’’ he added.

Obafemi said that said with the help of Mosimi depot will play a large role in fuel distributions not only in the south west, but also the whole of the country.

He said that this will help increase the circulation to Statelite, Ibadan, Ilorin and also will enhance the movement of fuel more faster than ever.

He said Mosimi which was regarded as the pipeline head quarters in Nigeria; this is where all trains and pipeline are conducted in early 90s.