The NNPC has raised an alarm on the proliferation of fuel stations in communities with international land and coastal borders across the country.
According to the corporation, the development has energized unprecedented cross-border smuggling of petrol to neighboring countries, making it difficult to sanitize the fuel supply and distribution matrix in the country.
Leading a top Management team of the corporation on a visit to the Comptroller General of the Nigerian Customs Service, Col. Hameed Ali (rtd), the Group Managing Director of NNPC, Dr. Maikanti Baru, revealed that detailed study conducted by NNPC indicated strong correlation between the presence of the frontier stations and the activities of fuel smuggling syndicates.
Dr Baru speaking to the Comptroller General of the Nigerian Customs Service, Col. Hameed Ali (rtd) during the visit. Photo credit: NNPC
He said that the activities of the smugglers had led to recent observed abnormal surge in the evacuation of petrol from less than 35 million litres per day to more than 60 milion litres per day which is in sharp contrast with established national consumption pattern.
Providing a detailed presentation of the findings, the NNPC GMD informed that 16 states, having amongst them 61 local government areas with border communities, account for 2,201 registered fuel stations.
The fuel tank, he noted, had a combined capacity of 144, 998, 700 (one hundred and forty four million, nine hundred and ninety eight thousand and seven hundred) litres of petrol.
Dr. Baru explained that because of the obvious differential in petrol price between Nigeria and other neighboring countries, it had become lucrative for the smugglers to use the frontier stations as a veritable conduit for the smuggling of products across the border, saying this had resulted in a thriving market for Nigerian petrol in all the neighouring countries of Niger Republic, Benin Republic, Cameroun, Chad and Togo and even Ghana which has no direct borders with Nigeria.
“’NNPC is concerned that continued cross-border smuggling of petrol will deny Nigerians the benefit of the Federal Government’s benevolence of keeping a fix retail price of N145 per litre despite the increase in PMS open market price above N171 per litre,’’ he said.
He noted that based on the heightened petrol consumption rate of 50 million litre per day, the corporation was incurring an under-recovery of N774 million every day.
On his part, the Customs boss thanked NNPC GMD for the elaborate data he provided on the fuel supply situation, noting that this would enable the service fashion out the appropriate architecture to combat the menace.
He called on the authorities to tackle the issue of price differentials which is the underlying motivation for smuggling activities.
Meanwhile, the NNPC and the Kogi state government have executed a Memorandum of Understanding (MoU) for the development of a fuel-ethanol processing plant that would produce 84 million litres of bio-fuel per year.
Speaking during the signing of the MoU on Monday, February 27, in Abuja, Dr Baru said the project would yield a cane mill and a raw and refined sugar plant of 126,000 tonnes annually.
He stated that the Bagasse co-generation plant would also generate 64 megawatts of power, stressing that the plant would include a carbon dioxide recovery and bottling plant with capacity of 2,000 tonnes per year.
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