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WHY NIGERIAN MARKETERS SCRAMBLE FOR NIGER'S PETROLEUM PRODUCTS(Daily Trust (Nigeria) Via Acquire Media NewsEdge) Growing insecurity, high level of corruption and costs are among reasons why Nigerian oil marketers, especially from the Northern region, patronise the Soraz Refinery located at Zinder, in Niger Republic. The 20,000 barrels per day (bpd) refinery is patronised mainly for its twin products of Diesel (AGO) and cooking gas (LPG). It is estimated that about 300 tonnes of gas is imported from the refinery on a weekly basis. Investigation shows that at present, ten marketing companies are licensed by the Department of Petroleum Resources (DPR) to import Gas from the Soraz refinery, namely, Rixon Energy, Safari Petroleum, Kjewel Gas and Petroleum, Himma Merchants, Whanu limited, One Ten Gas limited, Bokir International limited, Micpo Plc, A. A. Rano and AYM Shafa. Daily Trust findings showed that the refinery’s products cost less in Niger Republic than in Nigeria. Wholesale price of AGO is about N120 per litre in Niger while NNPC wholesale price is N137.66/liter. LPG is N120 per kg there while in Nigeria, it sells for around N140/kg, excluding transport costs. And since the government in Niger does not subsidise the prices of the commodities, marketers don’t have to wait for any government bureaucrat to decide how, or when, to refund the costs of bridging the products. One marketer who spoke to our reporter on condition of anonymity explained that costs of transporting petroleum products to the southern part of Nigeria discourage them from doing so. The Zinder Refinery is located about 300km from Kano. This means that a truck will consume less than 300 litres of AGO for a roundtrip. A trip to Lagos, Calabar, Port Harcourt or any depot in the south will cost, at least, 1, 200 litres of AGO to Kano. Safety is another significant reason why northern marketers are shunning purchases from the south. If a northern truck breaks down anywhere in the south, touts popularly called ‘Area boys’ will demand for protection money, otherwise they will remove the truck’s batteries and maybe its tires. This protection money is usually around N5, 000 per night. If a truck breaks down in Lagos, LASTMA will impound the truck and the owner has to pay a fine of N250, 000. Additionally, if a driver is not vigilant, his vehicle’s fuel tank can be broken and his AGO stolen if he is sleeping at night. Such things do not happen in Niger Republic. High rate of corruption has also deeply affected the system and made buying products from NNPC became fraught with so many risks. Firstly, paying for a product does not guarantee that one will get it. There are people that have paid for LPG 10 years ago in Warri Depot and are yet to lift it. Some marketers have made payments for AGO and PMS at Kaduna Refinery for more than 6 months. What baffles one is that products are being loaded everyday at the depots but only to marketers favoured either by NNPC staff or powerful politicians. However, even those that are able to load have to pay multiple “facilitation fees” to smooth their operations. Illegal fees are collected by NNPC, IPMAN, PEF, PTD, DPR, amongst many other agencies. The process is so terrible that at any given point a marketer is expected to grease some palms to scale through a process in Nigeria. If you buy from Niger, you are free from all these troubles. Buying there is easy and straightforward. Politicians do not interfere in the business of the refinery while the police and other relevant agencies do their jobs accordingly. If any tout harasses you, just report to the police and the tout is taken care of. When probed further on the quality of the products, the marketer said DPR certified the products before it is allowed for usage. Every product brought in from Niger refinery must be taken to Kano office of DPR to ascertain its quality. This is applicable to all those imported by sea or land as they must be tested in DPR laboratories. So the question of quality is not compromised. “Right now, the biggest issue is the Standards Organisation of Nigeria (SON) who have mounted checkpoints at the borders, demanding for money under the pretence that they have a mandate to check quality of goods coming into Nigeria. They have no jurisdiction over petroleum products. Only DPR has that mandate. You should check the enabling laws to verify this’’ he said. Other troubles, of recent, have to do with permits of importation, only those with import permits are supposed to bring in these products. However, the Customs allows everybody in, including traders from Niger, but Nigerians cannot sell LPG inside Niger Republic. Most petroleum marketers are not importing Premium Motor Spirit (PMS), otherwise known as petrol. A litre of petrol officially sells for about 200 naira at the refinery so buying from there is never profitable since government will not repay you for bridging the products. Speaking on the issue, The Katsina State Chairman of Independent Petroleum Marketers (IPMAN) Alhaji Abbas Hamza said few businessmen that have gas plants deal in the business of buying products from Niger. According to him, few of the major marketers and oil companies that engage in such venture are based in Kano, saying: “We are aware that highly placed persons do patronise Niger government’s refinery to do business there.” He wonders why such people do so when the refineries in Nigeria are working. He enthused: “I see no reason why I should patronise Soraz Refinery.” However, he was quick to note that if the government in Nigeria can collaborate with its Nigerien counterpart with a view to boosting business and cooperation between the two countries, many of his members might be tempted to join the cross-border business. |