Connect with us

Business

Adulterated Petrol Debacle Amidst Nigeria’s Crippling Refineries

Published

on

Before the current petrol crises occasioned by importation of a large quantity of off spec Premium Motor Spirit (PMS), a report had suggested that the federal government may have up till 2021 to stop the importation of dirty fuel into the country.

The report by international resource watchdog, Stakeholders Democracy Network (SDN), claimed that samples of petrol from illegal refineries in the Niger Delta were of a higher quality than imported equivalents. It said fuel exported from Europe exceeded European Union (EU) pollution limits by as much as 204 times.

The federal government, however, claimed that imported products conform to national standards and parameters set by regulators. This is against the fact that the country has been struggling to compel importers and refiners of petroleum products in the country to reduce sulphur in the products, especially in diesel, from over 10,000ppm to 50ppm.

According to African Refiners and Distributors Association (ARA), Africa faces enormous challenges of importing fuel with high sulphur and that a high-level engagement with the African Union is already ongoing to reduce sulfur in fuel to 50ppm by 2025 and 10ppm by 2030.

Only last week, the country was jolted with lengthy queues at petrol stations across the country.

Although, Abuja the nations capital had been experiencing shortage of supply during the December period without clear explanation from the authorities as to what could be responsible for that.

The nation came to the reality of the situation when Lagos, the commercial capital of Nigeria, began to feel supply distortions.

Rumors became rife that some yet to be identified partners of the Nigerian National Petroleum Corporation(NNPC) Limited had imported petrol with high sulphur.

The corporation, after keeping the public in suspense, later named four oil companies involved in the importation of offspec petrol in the country.

Before then, the Nigerian Midstream and Downstream Petroleum Regulatory Authority(NMDPRA),  came out with a confirmation that petrol with high quantity of methanol have been withdrawn from circulation.

The agency said the affected petrol has been withdrawn from circulation.

“The Nigerian Midstream and Downstream Petroleum Regulatory Authority (The Authority) wishes to inform the general public that limited quantity of Premium Motor Spirit (PMS), commonly known as petrol, with methanol quantities above Nigeria’s specification was discovered in the supply chain.

Methanol is a regular additive in petrol and usually blended in an acceptable quantity.

“To ensure vehicular and equipment safety, the limit quantity of the impacted product has been isolated and withdrawn from the market, including the loaded trucks in transit. Our technical team in conjunction with NNPC Ltd and other industry stakeholders, will continue to monitor and ensure quality petroleum products are adequately supplied and distributed nationwide,” it stressed.

The Chief Executive Officer/ Group Managing Director of NNPC, Mallam Mele Kyari had met with some oil marketers to resolve the issues generated by the recent supply and discharge of methanol blended petrol in some Nigerian depots.

However, in order to prevent the distribution of the petrol, the NNPC CEO said the company promptly ordered the quarantine of all un-evacuated volumes and the holding back of all the affected products in transit (both truck & marine).

Cat And Mouse Game

Till now, no marketer mentioned by the NNPC has admitted guilt thus sending wrong signals in the industry.

LEADERSHIP reports that Nigeria has struggled for years to address the vehicle pollution crisis due to the poor quality of fuels it was importing.

Despite being Africa’s largest oil producer, Nigeria imports almost all the petrol it consumes locally, due to the poor performance of the four state-owned refineries.

The plants, with a combined nameplate capacity of 445,000 barrels a day, b/d, have been shut for repairs for many years, and the government is currently working on overhauling them.

One of the marketers, indicted by the NNPC, MRS Oil Nigeria promptly denied any involvement in the circulation of adulterated petrol in the country, describing as mischievous, false, and untrue the allegation that it imported contaminated products into the country.

On its part, Emadeb/Hyde/Ay Maikifi/Brittania-U Consortium claimed that Brittania-U was responsible for the importation of adulterated petrol into the Nigerian market.

Oando Plc, while responding denied importing adulterated and substandard petrol into the country, as claimed by the NNPC.

Oando in a statement by the company secretary and Alero Balogun head, corporate communications, said, “Following media reports listing Oando as one of four importers that supplied methanol-blended Premium Motor Spirits (PMS) into the country, we hereby state that Oando did not import and supply PMS that was adulterated or substandard.”

International Bodies’ Reactions

An international organisation like Public Eye, a Swiss-based firm, had revealed that low-quality fuels that permit on average 200 times the sulphur content of Europe’s standards were allowed into countries like Nigeria. The United Nations Environmental Programme (UNEP), ARA and health campaigners have also been prodding Nigeria to ban fuels declared illegal in Europe and United States.

The UNEP, Economic Communities of West Africa States (ECOWAS) Commission, and the Climate and Clean Air Coalition (CCAC) had noted that switching to low-sulphur diesel and use of cleaner vehicles would result in yearly savings in health costs of about $6 billion in Sub-Saharan Africa.

ARA said the group is focused on ensuring that best practices are used for commercial refining operations to ensure key performance, and that health, safety and environment standards are followed to produce cleaner petroleum products.

ARA is collaboration with the African Union (AU) on the adoption of harmonised AFRI Clean Fuel Specifications across Africa. These Cleaner Fuel specs recommend the adoption of AFRI 5 (50 ppm sulphur for gasoline and diesel) by 2025 and AFRI 6 specs (10 ppm for same products) by 2030.”

 

Shortage Concerns

Industry observers say Nigeria, may face further crises in the downstream oil sector after NNPC, reportedly halted distribution of over 100 million liters of off-specification petrol industry.

NNPC Ltd. is intensifying efforts to increase supply of its gasoline imports, urging some trading houses to urgently secure prompt supplies, industry sources said.

It is also reported that the Corporation may need an estimated N201 billion to clean 170.25 million litres of adulterated product imported into the country up to standard.

The Nigerian Midstream and Downstream Petroleum Regulatory Authority had said on revealed that for every 200 litres of the adulterated product, 800 litres of petrol with good quality would be required for the blending that would be done.

“All the off-spec material (product) will re-blended to very good quality, and it will be certified and recertified before it goes into the market. The component that was in excess was methanol; what we agreed was that for every 200 litres of the affected volume, we need about 800 litres to blend,” the chief Executive Officer, NMDPRA, Mr Farouk Ahmed, had said during a visit to some depots in Lagos after a meeting with industry stakeholders.

The regulator said a limited quantity of PMS with methanol quantities above Nigeria’s specification was discovered in the supply chain.

The N201 billion is a conservative estimate, as there are other costs that would be associated with the re-blending.

President Muhammadu Buhari directed service providers to fully disclose relevant information concerning the consumption of their products and compensate dissatisfied consumers.

The Senior Special Assistant to the President on Media and Publicity, Garba Shehu, disclosed this in a statement titled, ‘Providers of substandard fuel must be held accountable, directs President Buhari.’

Also, the House of Representatives demanded a probe of key stakeholders allegedly involved in the importation of adulterated Premium Motor Spirit into Nigeria.

Restocking Depots

The Nigerian Ports Authority (NPA), on Friday, said that 25 ships were expected to arrive at the port from February 11 to February 22.

According to NPA, the ships were expected to arrive at the Lagos Port Complex, laden with petroleum products, food items and others.

It said that the ships contained general cargo, frozen fish, container, bulk sugar, butane gas, bulk wheat and petrol.

Also, the Authority said that 20 other ships were at the ports discharging bulk wheat, general cargo, container, frozen fish, bulk salt, bulk sugar, and petrol.

Others being discharged had plaster and soya bean meal on board.

READ NOW |  America COMPETES Act passes House without 'disastrous' provision on crypto
Advertisement
Click to comment

You must be logged in to post a comment Login

Leave a Reply

Facebook

Trending post

© 2022 Copyright suresource24. All Rights reserved.