Fuel Scarcity – We’re On Top of the Situation – NNPC

The Nigeria National Petroleum Corporation (NNPC) has reassured Nigerians it is on top of the petroleum products supply and distribution situation and remain committed to eliminating the queues once and for all within the next few days.

NNPC in a statement by its spokesman Garba Deen Muhammed said the current administration inherited a huge catalog of problems including arrears of subsidy payments to oil marketers, corruption and inefficiencies in the supply and distribution chain, incessant vandalism of pipelines, refineries poor performance, among others.

He said a combination of these issues resulted in most oil majors completely pulling out from the importation business and NNPC assuming a near 100% importation obligation without the necessary logistics put in place.

Mohammed said the NNPC Management initiated and made progress on various key solutions to providing a lasting end to these issues.

He listed the solutions to include the elimination of subsidy payments through price modulation which has resulted to savings of over N100bn monthly.

He added that supply constraints due to foreign exchange challenges are being resolved through collaboration with the Central Bank of Nigeria on innovative ways of closing the gaps in accessing foreign exchange.

The major international upstream oil companies have indicated their willingness to support major oil marketing companies with some of the required foreign exchange.

"In the medium term, NNPC is working on sustainable strategies to permanently address the issues and challenges facing the midstream and downstream sectors. The overarching objective is to make

Our commitment to ramp up our local Refining capacity and availability remains un-waivered with the ongoing rehabilitation works targeted at running all Refineries at a minimum 70% capacity utilization within the next 6 - 8 months," the statement said.

NNPC said it has secured presidential approval to take additional crude oil volume to guarantee national supply of petrol.

"Changes usually take time, effort and a lot of focus. We understand the plight of Nigerians and the impact on the overall economy. We genuinely empathize with the attendant sufferings and wish to reassure that we are focused and committed to bring an end to this situation within the next few days.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer