Fuel scarcity: NNPC moves to close supply gap, seeks emergency supplies of petrol from trading firms

The Nigerian National Petroleum Company (NNPC) Limited is seeking for emergency supply of petrol from oil trading firms to replace the cargoes of the contaminated product that were rejected for their poor and bad quality.

Nigeria’s commercial nerve centre, Lagos, and administrative capital, Abuja, have been experiencing long queues of vehicles at filling stations due to a shortage of petrol supply.

According to a report from Reuters, 2 sources who have direct knowledge of the matter and wish to remain anonymous, said the state-owned oil giant is asking for supply of about 500,000 tonnes of petrol from these oil trading firms.

Although this is yet to be officially confirmed, the NNPC is trying to bridge the supply gap of petrol to make up for the quantity that was withdrawn.

The NNPC has virtually been the sole importer of petrol in the country as Nigeria depends almost entirely on imports from the oil firm to meet its domestic demand after several failed attempts in the past to refurbish and rehabilitate the country’s various refineries.

What you should know

Recall that oil marketers and some stakeholders had attributed the current fuel scarcity in Lagos, Abuja and some other states to the withdrawal of adulterated petrol by the NNPC. They said that some of the petrol imported into the country under the Direct Sale, Direct Purchase (DSDP) contract had a high content of methanol and ethanol, which are regarded as highly harmful.
Finally, breaking its silence on the crisis, the Federal Government through the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), confirmed the earlier reports, saying that it found out the affected petrol supply chain that was in circulation, had methanol quantity that is above Nigeria’s specifications and subsequently had to withdraw them.
The Chief Executive Officer of NMDPRA, Mr Farouk Ahmed, in his reaction to the resurgence of fuel queues in Lagos and Abuja, said methanol quantity above Nigeria’s specification was discovered in a supply chain, which has since been isolated.
He said that oil marketers have been directed to ensure robust supply of petroleum products, while the regulators and quality control agencies of the government swing into action.
The Federal Government through the NNPC, imports petrol through crude-for-fuel contracts, known as direct sale, direct purchase (DSDP), with consortia of local and foreign oil firms.
Each consortium receives 20,000 barrels per day (bpd) of crude oil in exchange for products, making the combined total about 320,000 bpd of Nigeria’s output.

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