NNPC: Smuggling Strengthening Case for Market-led Petrol Pricing

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By Peter Uzoho

The Nigerian National Petroleum Corporation (NNPC) has said incessant smuggling of petrol out of the country was strengthening the case for a realistic and market-determined price for the product in the country.

The Group General Manager, Group Public Affairs Division of NNPC, Dr Kennie Obateru, said this in response to THISDAY’s question.

Obateru was reacting to a marketer’s view on a certain anonymous televised report in circulation at the weekend, which reported how Cameroonians were gaining from buying and selling petrol smuggled into their country from Nigeria.

The NNPC spokesman said the corporation’s products are sold to bona-fide marketers, who own petrol stations and who in turn sell to Nigerians.

Obateru, however, noted that it was unfortunate that products were being smuggled to neighbouring countries owing to the subsidised rate of petrol in Nigeria.

“Our products are sold to bonafide marketers who have retail stations through which to sell to Nigerians.

“Unfortunately, we have products being smuggled to neighboring countries because of the subsidised rate of petrol in Nigeria, thus strengthening the case for a realistic and market determined price for petrol

“So, we do not continue to subsidise petrol consumed by neighboring countries,” Obateru told THISDAY in an SMS response.

The marketer who spoke on condition of anonymity, had accused the NNPC of being the major cause of smuggling.

He accused the NNPC of allocating products to some entities way beyond their capacity, alleging that the entities now dispose the excess supply by smuggling.

This, the marketer said, contradicts the ‘Operation White’ project, a transparency initiative of the federal government established in October 2019, to check smuggling and track the importation and distribution of petroleum products in and out of the country.

Operation White, which was at the time, launched separately in Abuja and Lagos, has an 89-man monitoring team drawn from the NNPC, the Department of Petroleum Resources (DPR), Petroleum Equalisation Fund (PEF), Petroleum Products Pricing Regulatory Authority (PPPRA) and the Department of State Security (DSS), with the NNPC asked to drive the project.

The marketer said: “As for operation white, some entities are being allocated product way beyond their capacity.

“NNPC knows who they are because they are the ones who make the allocation. It is clear most of the products go across the border.

“If you have 100 stations and you get allocation equivalent of 1000 stations, your guess is as good as mine as to what is happening to the product.”