Nigeria’s oil and gas industry faces a new wave of challenges as the Nigerian National Petroleum Company Limited (NNPCL) has unexpectedly shut down its Customer Express Portal, a key payment platform for oil marketers. The shutdown has sent shockwaves across the petroleum supply chain, with many experts warning that fuel scarcity is now an imminent risk in the coming weeks.
The Customer Express Portal is the main gateway used by marketers for payments into NNPCL’s account, enabling seamless financial transactions and facilitating the lifting of petroleum products. This platform has been integral to ensuring the smooth operation of the downstream petroleum sector, allowing for the timely settlement of obligations necessary to secure product allocation and distribution across the country.
In a troubling development for Nigeria’s petroleum sector, oil marketers across the country have raised alarms over illegal levies being imposed on them by union operatives at various oil depots. Despite previous efforts to abolish such practices, these illicit fees have found their way back, leading to increased costs that ultimately burden consumers.
The resurgence of these illegal levies has been confirmed by multiple sources within the oil marketing industry. Marketers report that unions at depots across the country are demanding a charge of about N1 per liter of petroleum products loaded. This levy, while seemingly small, contributes significantly to the overall cost, adding to the landing cost per liter and inflating fuel prices for end users. For an industry already grappling with fluctuating international crude prices and domestic operational challenges, these unauthorized fees only add to the financial pressures on oil marketers.
The practice of imposing these levies was banned in the past, with regulatory authorities taking steps to streamline operations and improve transparency across the sector. However, it appears that the unions, through renewed influence, have once again infiltrated the system, reestablishing a culture of extortion that many had hoped was permanently eradicated.
Marketers and industry stakeholders have expressed frustration with this development, calling on the government and regulatory bodies to take immediate action. According to reports, the illegal levies not only increase operational expenses but also contribute to inefficiencies and delays within the supply chain, affecting the availability and cost of fuel nationwide.
One marketer, who preferred to remain anonymous, explained, “It’s disheartening that after all the efforts to create a streamlined and corruption-free supply chain, we are back to this. Every additional cost, whether it’s N1 or N10 per liter, eventually affects the pump price that consumers pay. We urge authorities to act swiftly to address this challenge before it spirals out of control.”
These union activities have drawn widespread criticism, with experts emphasizing that such practices could hinder progress in the nation’s energy sector and deter investments in the downstream segment. By inflating costs through unofficial channels, the unions are effectively undermining efforts to stabilize fuel prices and improve the overall efficiency of fuel distribution across the country.
With oil marketers calling for urgent intervention, the spotlight is now on Nigeria’s regulatory bodies to step in and put an end to these illegal practices. Industry watchers hope for swift and decisive action, as continued extortion threatens to undo years of progress made towards ensuring a fair, transparent, and sustainable petroleum industry.
FG Removes VAT On Key Products To Cut Energy Costs, Boost Clean Energy Transition, And Attract Global Investments With New Tax Reforms
The Nigerian government has unveiled a bold move to reduce the cost of living by removing Value Added Tax (VAT) on key energy products, including diesel, Compressed Natural Gas (CNG), Liquefied Natural Gas (LNG), and electric vehicles. The new VAT exemption, announced by the Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, on Wednesday, is set to drive down prices and accelerate the nation’s transition to cleaner energy sources.
The VAT Modification Order 2024 covers a range of vital energy products and infrastructure, including: Diesel Liquefied Petroleum Gas (LPG) Compressed Natural Gas (CNG) Electric Vehicles Liquefied Natural Gas (LNG) infrastructure Clean Cooking Equipment According to Edun, the VAT exemption aims to reduce living costs, bolster energy security, and speed up Nigeria’s shift to greener energy alternatives. The initiative aligns with the administration’s commitment to sustainability and economic growth.
Tax Incentives To Boost Oil And Gas Investments
In a further move to drive economic growth, the government has introduced new tax incentives for deep offshore oil and gas production. The initiative, part of the Oil & Gas Companies (Tax Incentives, Exemption, Remission, etc.) Order 2024, is designed to make Nigeria’s deep offshore basin a leading hub for global oil and gas investments. Edun emphasized that these reforms are part of broader policy initiatives spearheaded by President Bola Ahmed Tinubu, aimed at enhancing Nigeria’s competitiveness in the global energy market.
The latest tax relief measures aim to position Nigeria as a key player in the global oil and gas sector, ensuring sustainable growth in the energy industry.
Exclusive Insights into the Life, Passion, and Vision of Nigeria’s Foremost Oil and Gas Expert
Festus Osifo is a renowned industry leader and philanthropist who has made significant contributions to the oil and gas sector in Nigeria. Born into a modest family, Osifo’s early years were marked by strong values and work ethic instilled by his parents . He excelled in his early education, demonstrating exceptional academic prowess, and later attended a prestigious university where he earned his degrees
Osifo’s professional journey began with challenging yet opportunities-filled job experiences that contributed to his growth and development . He quickly made a name for himself, taking on important projects and roles that showcased his skills and dedication. As the President of Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN), Osifo proclaimed a new dawn for the staff of the Association, emphasizing his commitment to their welfare
Throughout his career, Osifo has held several leadership positions, including serving as the President General of the Trade Union Congress of Nigeria (TUC) . He has been recognized for his contributions to the industry, receiving various awards and accolades . Osifo is also a member of the Nigeria Society of Engineers (NSE), Council of Registered Engineers of Nigeria (COREN), and Society for Petroleum Engineers (SPE) .
Key Achievements:
Leadership Roles: President of PENGASSAN and President General of TUC
Industry Contributions: Introduced innovative ideas and practices that transformed the oil and gas sector
Awards and Recognitions: Received various awards for his contributions to the industry
Philanthropy: Involved in charitable activities, using his resources and influence to make a positive impact
Osifo’s personal philosophy emphasizes integrity, hard work, and a commitment to excellence, guiding his actions and decisions . He believes in mentoring others, sharing his knowledge and experience to help them grow and succeed . With his vision for the future, Osifo aims to continue driving innovation and making meaningful contributions to the industry
The Nigerian National Petroleum Company Limited, NNPCL, has delivered a total of 48.6 million barrels of crude oil to Dangote Petroleum Refinery in the past 10 months, Vanguard investigations have revealed.
Details of the deliveries contained in official data on the transaction sighted by Vanguard showed that 3.4 million barrels (mb) were supplied in December 2023 while 3.5 million barrels were supplied in February 2024.
The details further showed that 3.3md, 3.3mb, 3.0mb, 5.1mb, 5.1mb, 4.8mb and 5.6 were supplied to the refinery in March, April, May, June, July, August and September 2024 respectively. The transaction has already recorded 11.7mb for October 2024 deliveries.
However, sources close to the Dangote Refinery said the volume supplied remains low when compared to the installed refining capacity of the 650,000 barrels per day plant.
The NNPCL has not yet disclosed the crude oil requirements of Nigeria’s refineries, including Dangote refinery in the last quarter (October – December) of 2024.
But in the second quarter (Q2’24) of 2024, the government put the requirements of all Nigeria’s refineries, including Dangote Refinery, at 597,700 barrels per day, indicating an increase of 114.700 barrels per day, from 483,000 bpd in the first half of the year.
The Q2’24 estimate also indicates that the NNPCL may have booked the crude oil needs of Dangote Refinery at less than 50% of the installed production capacity.
Petrol imports fall 12%
Meanwhile, the volume of Premium Motor Spirit, PMS, also called petrol fell year-on-year (YoY) by 12.6 percent to 20.29 billion litres in 2023 from 23.24 billion litres in 2022.
The National Bureau of Statistics, NBS, disclosed this yesterday in its “Petroleum Products Distribution Statistics for 2023”, noting that PMS trucks also dropped by 16.9 percent YoY to 20.22 billion litres from 24.35 billion litres in 2022.
According to the bureau, the volume of Automotive Gas Oil, AGO, also known as diesel, imported rose to 4.94 billion litres in 2023 from 3.99 billion litres in 2022.
The statistics also showed that 109.39 million litres of AGO were locally produced in 2023, representing a 6.76 per cent rise from 102.47 million litres produced in 2022.
Similarly, the volume of Household Kerosene (HHK) locally produced grew by 56 per cent YoY to 69.7 million litres in 2023 from 44.68 million litres in 2024.
However, the data showed that local production of Petrol ended in 2018 when 128.08 million litres was produced.
NBS said: “In 2023, PMS truck out stood at 20.22 billion litres, indicating a 16.96% decrease relative to 24.35 billion litres recorded in 2022.
“About 69.71 million litres of HHK were locally produced in 2023 compared to 44.68 million litres in 2022, indicating a growth rate of 56.02 percent over the period.
“For AGO, 109.39 million litres were locally produced in 2023, higher, compared to 102.47 million litres reported in 2022. This represents a 6.76 percent growth rate.
“In terms of imported products, 20.30 billion litres of PMS were imported in 2023 relative to 23.54 billion litres in 2022, showing a decrease of 13.77 percent
“Also, 4.94 billion litres of Automotive Gas Oil were imported in 2023, indicating an increase of 23.66 percent compared to 4.00 billion litres in the previous year.”
The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) has clarified the reasons independent marketers are unable to purchase petrol directly from Dangote Refinery.
The association’s president, Festas Osifo, at a press conference in Lagos, on Tuesday, said the issue stems from a pricing disparity between the costs at which the Nigerian National Petroleum Company Limited (NNPCL) buys PMS and the prices it sells to independent marketers.
Osifo explained that NNPC may purchase PMS at approximately N950, but sell it to independent marketers at around N700, leading to a significant shortfall that NNPC manages.
He said major marketers would buy directly from Dangote at a price similar to NNPCL’s purchase but would need to sell it at a higher price, potentially over N1,000.
Independent marketers prefer to purchase from NNPCL to take advantage of the lower prices, he said.
Osifo noted that some crude oil has been tied to loan repayments, limiting the available supply for local consumption.
He cautioned that the ongoing trend of divestment by International Oil Companies (IOCs) poses both risks and opportunities for Nigeria, including potential reductions in foreign direct investment and production levels.
UYO – PREMIUM Motor Spirit (PMS) on Tuesday shot to N2500 per litre in Akwa Ibom state with consumers hardly able to get it as Independent Petroleum Marketers Association of Nigeria (IPMAN) engages in panic sales over lingering faceoff between the Nigeria Union of Petroleum and Natural Gas Workers (NUPENG) and the Joint Task Force (JTF).
The situation has worsened transportation in the state with an increasing decline in the number of vehicles on the road and transporters raising fares by over 200 per cent as NUPENG stopped tankers from entering Akwa Ibom for the past few days.
Most filling stations run by independent marketers monitored in Uyo and environ were shut in response to the “Notice of Withdrawal of Services Over Confiscation of PMS – Loaded Trucks by JTF Personnel”, signed by the Chairman, Coordinating Committee, Francis Udoyen, and Secretary, Prince Ekom Idemudo.
They said it was imperative to call out their members in solidarity with NUPENG to demand the release of the PMS-loaded trucks seized from some members four months ago by men of the JTF, Operation Delta Safe (ODS).
“As part of our obligation to stand for each other in and off-season, equally drawing strength from the resolution taken at the last emergency congress over members’ trucks in the custody of the JTF operatives for four months now, you are hereby directed to close your filling stations from the public with effect from Tuesday, September 24, 2024.
“This action has the approval of our national office, and non-compliance will be visited with appropriate consequences”, the IPMAN directive read.
State Chairman, Natural Oil and Gas Association of Nigeria (NOGASA), Sam Osung, former Aide to Governor Umo Eno, blamed the state government for failing to wield the big stick against perceived excesses of NUPENG and IPMAN.
Osung accused the stakeholder groups of overreaching themselves in the state, arguing that if they felt offended by the JTF’s impounding of their fuel trucks, the lawful thing to do was to go to court to prove their case and not hold fuel consumers to ransom.
He narrated that, “Men of the ODS under the 2 Brigade, Nigeria Army, arrested two trucks of PMS and 44 drums of PMS from six filling stations at Ibaka, Mbo Local Government Area over four months ago. The filling stations were accused of involvement in petroleum products smuggling.”
“Officials of IPMAN addressed a press conference demanding the immediate release of the trucks. Subsequently, they shut down their filling stations and embarked on a protest in Oron LGA.
“The ODS decided that if the owners consider themselves innocent they should go to Court. We know that smuggling is an act of economic sabotage and an innocent marketer should have gone to Court to prove his innocence.
“The marketers are trying to bully the Army to release their trucks without proving their innocence. They have hired the Petroleum Tanker Drivers (PTDs), to stop products from entering Akwa Ibom since last Monday.
“The Army was informed and they want to rescue the impounded trucks and escorted the trucks to the owners while requesting the documents authorising them to stop tankers from entering any state.”
He added, “The government is aware of the excesses and no one is addressing this. The government should say something. The government should act as a government.
“They did it before with the allegation that I was their problem because I know what they know, and even know their rights based on their constitution. They ganged up and the governor fired me.
“That didn’t solve the problem. I wish the government was able to address the matter based on the right and privileges of everyone who was involved. Government was more interested in making me the scapegoat.
“The issue of the excesses of NUPENG wasn’t addressed, and today, they have illegally stopped tankers from entering Akwa Ibom for about a week and IPMAN has resumed panic sales with a hike in price.”
Filling stations owned by the Nigerian National Petroleum Company Limited (NNPC) have hiked the fuel price to over N850 per litre in the country.
SaharaReporters learnt that this move by the filling stations was in compliance with a directive given by the NNPC management compelling an immediate increment of fuel official price from N568 to N855.
Checks by SaharaReporters in Ilorin, Kwara State showed that the filling stations on Tuesday morning complied with the directive on the increment.
An NNPC station located at Adewole Area of Ilorin, the state capital is currently selling fuel at N877 per litre.
A picture of an NNPC station in Lagos which SaharaReporters saw indicated total compliance with the directive as the new price is pegged at N855 in the state.
A viral video on X showed how Nigerians are lamenting the new price.
“N855 at NNPC station in Ikoyi area (Lagos State),” a customer said in the video.
THE presidency has affirmed that President Bola Tinubu will not intervene in the ongoing fuel price controversy between Dangote Refinery and the Nigerian National Petroleum Company Limited (NNPCL).
The Special Adviser to the President on Information and Strategy, Bayo Onanuga, revealed this to journalists at the Presidential Villa, Abuja on Wednesday, emphasising that both entities operate independently in a deregulated market.
The presidential aide: “The PMS field, the PMS regime, has been deregulated. Dangote is a private company. NNPC should not forget is a limited liability company.
“NNPC is on its own, even though it’s owned by the Federal Government, the state government and local councils and everything, but it’s operating as a limited liability company.
According to Onanuga, instead of intervening, the government plans to promote alternative energy solutions like Compressed Natural Gas (CNG), offering a cheaper option for consumers and subsidising conversion costs for vehicles.
Furthermore, Onanuga pointed out that the administration is encouraging states to develop urban transportation systems to reduce overall transportation costs.
He stated: “In addition, the government is going to encourage many of our states to go into bank transportation so they can help to make sure that they reduce the cost of transportation in many of our cities. As of now in the entire country, only Lagos, state has an urban transport system.
“Any modern city should have an urban transport system, a bus system, or racist and so on and so forth.
So that’s the government, the plan of government to make sure that we shift our attention from just one consumer payments, there must be an alternative energy that we can also use which is cheaper, and CNG has proven to be that.
“And the government also has a plan to make sure that even private car owners can convert to CNG at a reduced cost.
“For transporters, is almost free for them, but for private vehicle owners, the government has a plan to subsidise, I mean, the cost of converting the from petrol to CNG.”
Meanwhile, Presidency has confirmed that President Tinubu will soon reshuffle his cabinet.
The cabinet was constituted in August of last year.
The President has expressed his desire to reshuffle his cabinet and he will do it. I don’t know whether he’s going to do it before October 1, but he will surely do it. So that’s what I will say. He has not given us any timeline he’ll do it, but he will to do it.
He has expressed his plan he wants to do it.”
Also speaking, the Senior Special Assistant to the President on Digital Media, O’tega Ogra, explained the president will be guided by an empirical process being coordinated by the Special Adviser to the President on Policy Coordination and head of the Central Delivery Coordination Unit, Hajia Hadiza Bala Usman.
He added: “We also need to realise that the President’s decision to reshuffle is also based on empirical evidence. He has said it during the retreat for the ministers that they were going to have periodic reviews, and the decisions that are extracted from these reviews will be used to make that final decision.
Meanwhile, Presidency said the Education Trust Fund (TETFUND) will allocate 30% of its resources to support the Nigerian Education Loan Fund (NELFUND) for student loans.
Onanuga, who spoke on the Economic Stabilisation Bill, added: “The amendment to the TET-FUND Act is crucial for enhancing student access to education.”
“The funds previously used for infrastructure will now support student loans, ensuring that all children can attend school, regardless of their parents’ financial status,” he noted.
Also speaking, Senior Special Assistant on Digital/New Media, O’tega Ogra, recalled that during the #EndBadGovernance protests, President Tinubu announced that financial recoveries from illegal activities will be allocated to support the Nigerian Education Loan Fund (NELFUND).
Не stated: “The President assured that funds from illegal activities would used to bolster NELFUND.
The Executive Secretary of TETFUND, Sonny Echono, highlighted that the 2023 Intervention Budget of N320 billion is fully allocated to beneficiary institutions.
“We are committed to ensuring that these funds are judiciously utilised to impact the common man,” Echono stated.
Onanuga also hinted that President Tinubu is to send an executive bill seeking to amend the National Identity Management Commission (NIMC) Act to the National Assembly.
When passed and signed into law, it will mandate everybody living in Nigeria, including foreigners to be registered and given the National Identity Number (NIN) so that they can be taxed.
