Downstream sector not fully deregulated, says MOMAN

The Major Oil Marketers Association of Nigeria (MOMAN) on Tuesday said that the downstream sector of the oil and gas industry had not witnessed full deregulation.

The Executive Secretary, MOMAN, Obafemi Olawore, said this on the sideline of re-commissioning of storage tanks at Mosinmi depot in Ogun by the Group Managing Director, NNPC, Maikanti Baru.
He said that the development posed a serious challenge to marketers.
Olawore called on the Federal Government to fully deregulate the downstream sector to create room for more investments, expected to push down the current price of Premium Motor Spirit (PMS).
According to him, government has not fully deregulated the downstream sector but only succeeded in adjusting the pump price upward.
“The truth is that NNPC is currently importing more than anybody because it has easier access to foreign exchange than anybody.
“Our intention is to have the sector fully deregulated.
“ The downstream sector has not been fully 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 and quality delivered are satisfactory,’’ the executive secretary said.
Olawore said that market forces comprising access to 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 would not want their business to collapse, ’’ he said.
The MOMAN chief commended the government for partially deregulating the downstream segment of the oil industry.
Olawore said 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 toward 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 said.
Olawore said that Mosinmi depot would play a large role in fuel distribution; not only in the South West but also in the whole country.
He said that this would help increase the movement of fuel faster than ever.
Olawore said Mosinmi is regarded as the pipeline headquarters in Nigeria.
According to him, this is where all trains and pipelines are conducted in early 90s. (NAN)