Business
IPMAN blames N617 fuel price on security agencies’ extortion, levies
The Independent Petroleum Marketers Association of Nigeria (IPMAN) has blamed the recent increase in fuel prices from N537 to N617 on extortion by security agencies and arbitrary levies by government institutions.
The IPMAN National President, Chinedu Okoronkwo, who spoke at a public hearing organized by the House of Representatives Ad-hoc Committee on the Recent Hike in Petrol Pump Price on Tuesday, said those factors, combined with international pricing, led to an increase in the price of the product in the country.
Okoronkwo told the legislators that IPMAN members are presently cash-trapped and cannot engage in direct importation of fuel as the Nigerian National Petroleum Company (NNPCL) owes them about N250 billion.
The IPMAN leader further called on the Federal Government to instruct all its agencies to put a stop to arbitrary charges that are built into the price of fuel by marketers.
Speaking further, Okoronkwo recommended a switch over to the use of Compressed Natural Gas (CNG) to permanently address the rising cost of Premium Motor Spirit (PMS) and ease the challenges brought by the removal of subsidies.
Okoronkwo said that in spite of the excruciating pain of subsidy removal, it was the right decision, and what was left was for the government to bring relief.
“Energy everywhere is critical; it is on the security list of every nation, and God has given us about the best gas that can last for over 500 years.
What we require now is to build the market; the demand will be there, and we need this house to help us build the market.
IPMAN National President Chinedu Okoronkwo
“Everyone is feeling the pinch; everyone has taken the bullet; palliatives are just for some time; the permanent solution is what we have brought to the nation, and we tag it good news because with little money you can fill your tank and still do business,” he said.
Also speaking, a partner of IPMAN and the managing director of Gas Analytics and Sorutiral Index, Brian Amonu, said Nigeria has more gas than crude oil, noting that a lot of gas is flared in the country because there is no organized market for the product.
“This solution lies in the Central Bank of Nigeria (CBN), and in it lies a N250 billion gas expansion facility.
The objective of that facility is to support the utilization of natural gas; we have written to the CBN since last year, way ahead of subsidy removal; we have had meetings convened by the former Finance Minister and the CBN, NNPC, and other stakeholders, and we told them the solution to subsidy removal can be implemented in one day.
“Nigerians, vehicle owners, and the state government should be given access to borrow N200,000 to convert their vehicle or tricycle from that N250 billion. That will catalyze investments along the value chain because you need to have a large number of converted vehicles to justify the investment to deliver that gas to every part of the country.
“The solution is here; we have been preaching this since last year; the government does not have to do anything new; there is funding at CBN to support this. The only way natural gas can be a substitute is by providing loans for vehicle users.
“If we convert just 10 percent of the 48 million liters of Premium Motor Spirit (PMS), otherwise known as petrol, we consume a day to natural gas, it will save Nigerians two billion naira every day, or N730 billion naira every year.
“Just by transitioning 10 percent of the petrol we consume today to natural gas, what that means is that we can deliver natural gas through the IPMAN platform in Kebbi, in Borno, at N200 per liter equivalent,” he said.
In his comments, the chairman of the Committee, Hon. Babajimi Benson, said petrol is the lifeline of the Nigerian economy, and an increase in the price will affect the price of food, on which Nigerians spend 80 percent of their income.
“This is why we fear that this recent increase will further push Nigerians deeper below the poverty line. This committee is confident that the government means well for Nigerians and has a justification for this action. This is what we want to hear at this investigative hearing. Nigerians need to understand the rationale behind this action.
“But beyond that, they need to be assured that this price hike will not have a more devastating effect on their livelihoods. We need to be able to convince Nigerians that their interests will always be protected.
“We therefore urge you to be open and objective in your submissions and provide the necessary information that will guide the committee in reaching a decision that will be mutually beneficial for the government and Nigerians in general since the primary goal of governance is the welfare of citizens,” he said.
