Petrol demand hits 50 million litres daily, NNPC incurs N24bn monthly as subsidy

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The Nigerian National Petroleum Corporation on Sunday announced that it was spending N774m daily (about N23.99bn monthly) as subsidy on the 50 million litres of Premium Motor Spirit consumed across the country.

Although it described the amount as under-recovery, the oil firm stated that the amount was due to the proliferation of filling stations in communities with international land and coastal borders across the country.

The Group Managing Director, NNPC, Maikanti Baru, said the multiplication of filling stations had energised unprecedented cross-border smuggling of petrol to neighbouring countries, making it difficult to sanitise the fuel supply and distribution matrix in Nigeria.

Baru disclosed this when he led a management team of the corporation on a visit to the Comptroller-General, Nigeria Customs Service, Col. Hameed Ali (retd.), according to a statement issued on Sunday by the firm’s Group General Manager, Group Public Affairs Division, Ndu Ughamadu.

Baru stated that a detailed study conducted by the NNPC indicated strong correlation between the presence of the frontier stations and the activities of fuel smuggling syndicates.

He said the activities of the smugglers led to the recent abnormal surge in the evacuation of petrol from less than 35 million litres per day to more than 60 million litres per day, which was in sharp contrast with established national consumption pattern.

Providing a detailed presentation of the findings, the NNPC boss noted that 16 states, having among them 61 local government areas with border communities, accounted for 2,201 registered fuel stations.

He stated that the tanks of the facilities had a combined capacity of 144,998,700 litres of petrol.

Baru stated that in the same vein, eight states with coastal border communities spread across 24 LGAs accounted for 866 registered fuel outlets with combined petrol tank capacity of 73,443,086 litres.

He said a further breakdown of the findings showed that among the states with land border, three LGAs in Ogun State accounted for 633 fuel stations with combined petrol tankage of 40,485,000 litres, while nine LGAs in Borno State had 337 fuel outlets with combined petrol storage capacity of 21,114,480 litres.

According to him, Lagos with one LGA as border community has 235 registered fuel stations with total storage facility of 19,916,600 litres.

The statement noted that on the coastal front, Lagos with six LGAs led with 487 registered fuel stations with combined in-built storage capacity of 50,239,560 litres.

It said, “Akwa Ibom, with five LGAs, has 134 registered retail outlets with capacity to store 8,322,986 litres; while Ondo State, with two LGAs, has 110 fuel stations with capacity to store 3,871,320 litres.”

Baru explained that because of the obvious differential in petrol price between Nigeria and other neighbouring 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, adding that this had resulted in a thriving market for Nigerian petrol in Niger Republic, Benin Republic, Cameroon, Chad and Togo, as well as Ghana, which has no direct borders with Nigeria.

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