IBRAHIM QUADRI
There is strong indication that Nigeria loses about eight to 10 million litres of Petroleum Motor Spirit (PMS) otherwise called petrol on daily basis due to cross border smuggling.
The Group Managing Director of the Nigerian National Petroleum Products (NNPC), Mele Kyari disclosed this on Tuesday.
Kyari, who featured during a live programme, Sunrise Daily on Channels TV, stated that as a result of high level of smuggling being perpetrated, President Muhammadu Buhari had given directive that everything possible must be done to curtail the sharp practices.
Although, NNPC boss did not give the actual millions of litres of petrol lost to smuggling, the differentials during lockdown and border closure, show the current supply of 60 litres on daily basis are at variant with local consumption.
According to media reports, not less than 1,000 illegal routes are in operation used by smugglers across the country.
With this unwholesome practice, as a result of subsidy regime in the country, petroleum marketers transport fuel to neighbouring countries and sell at higher prices.
President Buhari had in November 2019 ordered that petrol should not be supplied to filling stations close to borders at the radius of 20km.
But, despite this order, smuggling of petrol still persists, which according to NNPC boss brought the daily supply to marketers by NNPC to 60 litres per day.
Kyari believes if the nefarious activities of smugglers are curtailed, the country petroleum consumption would be marginally reduced.
He disclosed further that during the border closure about 53 million litres of petrol were consumed per day.
However, during the peak of coronavirus pandemic in the country, Kyari stated that 42 million litres per day were consumed during the lockdown.
He therefore argued that, “If you can remember, during the COVID-19, there was lockdown for sometime but there was no absolute lockdown in this country, municipal movements were still going on. When you look at it, most of the countries had their countries shut down, so there was no need for cross border smuggling at that time, so during that period, we saw the consumption going down to about 40 million.”
He recalled that in March 2020, “We saw an opportunity to deregulate because the price of petroleum at the international market was low, that was why we brought it down to N145, that was the reality.”
He stressed that the country is not paying subsidy but payment for under recovery, arguing “under recovery means that NNPC goes to the market to buy the product at N250 to a litre and sell it at N162, so we are not able to recover our cost but as regard subsidy, you spent and you later pay back.
“We know for sure that the consumption of fuel in this country is not up to 60 million litres. Obviously, anytime you do short of that, you see the scarcity on our streets. What we call consumption today is a function of what we get from fuel depots.
“More importantly, we have the organized cross border smuggling. As you are aware we pay N162 to a litre, that means anywhere in the world, you are going to sell it above that price. That is the challenge we have. But the reality is that you have to transport fuel into the country,” Kyari stated.
While buttressing on the challenges by NNPC, Kyari explained that, many petroleum marketers cannot meet up with the foreign exchange balance of payment, adding that petroleum is expensive now.
“Petroleum is expensive now, we need a lot of foreign exchange to support this, that is another complication that we have,” he said.
He debunked the argument that security agents are also accomplices on smuggling, saying “I think that is not correct because smugglers are there to flout any order.
“We are still going to carry out measures to curtail cross border smuggling. Mr President has directed we do everything possible to put down this volume, that we cannot explain that cross border is happening as a reason for this volume,” said Kyari.
