- N145 Pump Price Not Sustainable Again, Says Kachikwu
- Baru: Spiking Prices In Neighboring Countries Led To Fuel Diversion
By ‘Dotun Akintomide
As the lingering fuel crisis hit its crescendo, facts emerged Thursday that the presidency had been subsidising petrol for N26 per litre without authorisation of the parliament which ought to pass such expenditure as part of the budget.
The N26 has been the differential between the 171 landing cost and the N145 pump price per litre of PMS, otherwise known as petrol.
At the public hearing by the joint committee of the National Assembly on Petroleum Downstream yesterday, it was expected that the committee would ask the minister and the NNPC GMD to explain the source of the subsidy being paid.
But Senator Kabiru Marafa shocked everyone present at the meeting when he announced, at the commencement of the sitting, that the meeting would only focus on the ongoing fuel crisis “while other issues would be dealt with by other committees at appropriate times”.
True to his words, he overruled efforts by a member of the committee to bring the issue of subsidy payment to the table for discussion.
Speaking on the appropriate pricing for fuel, the Minister of state for Petroleum, Ibe Kachikwu told Lawmakers that “The landing cost of products today is about N170/171.
“The price at which we sell it is N145. So, there’s a disparity between the N170 and N145.
“What that means is that those individuals who are really there may not feel an obligation like NNPC has to meet national supply.
“So, we need to step back to determine what do we do.”
Asked if the N170/171 was the landing cost or the ex-depot cost, he said the landing cost would be about N160.
When further asked by the lawmakers if N170/171 was what Nigerians were expected to pay at the pumps, Kachikwu said there were other related costs like NPA, NIMASA, storage, lighting and other charges that would determine the final price.
While for the GMD NNPC, Maikanti Baru, the high cost of fuel in neighbouring countries gave room for greedy fuel marketers to divert fuel for higher prices.
“Our surrounding countries are selling for not less than N300 and above.
“Countries like Cameroon sell for N407. That large price differential, N145 to N400, is a large prospect for smugglers,” he noted.
Speaking on average daily consumption of fuel in the country, Baru said, “Nigerians consume between 27 and 35 million litres of PMS per day.”
The meeting yesterday follows the summoning of the two top officials of the petroleum sector on December 28, 2017 by the Senate Committee on Petroleum Resources (Downstream) with a directive by Senate President Bukola Saraki that the committee cut short its Christmas and New Year recess and immediately convene a meeting with industry stakeholders.