The Federal Government has said it has no plans to increase pump price of Premium Motor Spirit also known as petrol.
According to the presidency, the proposed hike was the opinion of former Group Managing Directors of the Nigerian National Petroleum Corporation (NNPC).
The forum of former Group Managing Directors of the NNPC had on Saturday said that the present pump price of petrol was unsustainable in the face of current realities while calling for a removal of price cap in the pricing template.
With the removal of the price cap, marketers would be at liberty to sell petrol at their convenient price, based on several factors such as the exchange rate and international crude price. Consequently, Nigerians would be required to pay more.
After a closed door meeting with President Muhammadu Buhari,
Minister of State for Petroleum, Ibe Kachikwu, said the government has no plans to increase the price of petrol.
Kachikwu, who spoke while addressing journalists after a meeting with President Muhammadu Buhari, said there was no such plans.
The former state oil chiefs argued that the current price cap of N145 per litre of petrol was “not congruent with the liberalization policy.”
The current petrol price was approved by government when naira exchange rate was within N300 band but it has since spiralled to over N400 in the at the parallel market.
“Have you seen any memo to that effect?” he responded when pressed on the matter by journalists. The minister was accompanied to the meeting with the president by Mr. Baru who also said the government has no plan to increase the price of petrol.
“There is nothing like that,” Kachikwu said.
Earlier, the Petroleum Products Pricing Regulatory Agency (PPPRA), the agency responsible for pricing of petroleum products, had equally said it was not willing to accept the suggestion offered by the former GMDs.
The former GMDs had at the end of their meeting with the current GMD of the NNPC, Maikanti Baru and a representative of the minister of state for petroleum made suggested amongst other issues that the price cap of N145 per litre of petrol was “not congruent with the liberalization policy.”
According to the forum, the current ceiling price of N145 per litre did not factor the current foreign exchange (FOREX) rate and other price components of the pricing template, like crude oil cost and Nigerian Ports Authority (NPA) charges, which remain uncapped.
Speaking to an online news medium, Premiumtimes, Sotonye Iyoyo, executive secretary of PPPRA said the proposal was the personal opinion of the former state oil chiefs.
“If it was a recommendation, that is what it is – a personal opinion. I’m not aware government is planning any fuel price increase. We are in a liberalised market already,” she stated.
Speaking in a similar manner, Garba Deen Mohammed, spokesman of the NNPC, also described the advice as an “opinion.”
“The forum was expressing its opinion, which it is entitled to. NNPC is a player in the petroleum industry and has a right to have its views about the industry. Nobody is bound by the opinion.”
The forum also advised the federal government to include funding of joint venture operations as first line charge to guarantee sustainable oil and gas production and national reserve growth.
The industry has, for years, been contending with challenges of dwindling investments to grow production and national reserves, due to inability of government to meet its funding obligations to the joint venture regularly.
The meeting also reviewed issues affecting operations of the oil and gas industry as well as recommendations to resolve them.
The issues include the insecurity in the Niger Delta, NNPC’s poor corporate reputation, poor state of the country’s refineries, current state of petroleum products supply pricing template, and need to focus attention on the Chad Basin in the ongoing frontier oil exploration activities in the northern part of the country.
Other issues include operations of the National Petroleum Investments Management Services, NAPIMS; Petroleum Industry Bill, PIB; NNPC’s relationship with its partners; NNPC’s dwindling revenue base and rising debt profile as well as its widening pension funding gap.
