Financial Energy Review
Major Oil Marketers Association of Nigeria (MOMAN) has predicted in it’s energy forecast that the Nigeria National Oil Company Limited (NNPCL) will for some time remain the major importer of Premium Motor Spirit (PMS) otherwise known as Petrol.
According to MOMAN, about 95 percent of the product will continue to be imported by NNPCL.
This, the Association said will also be putting strain on the country’s resources and limiting private sector participation.
“In the near term, industry experts anticipate that the country will continue to be in a net import position until the completion of the ongoing refinery projects, namely the Dangote Refinery and the rehabilitation projects of NNPCL (Port Harcourt, Warri, and Kaduna)” MOMAN predicted
Though the Association is expecting that a moderate but sustained increase in local diesel production from modular refineries (Ogbelle, Waltersmith, Edo, and OPAC). “Domestic PMS production will not keep pace until these projects are completed” MOMAN said.
Olise Wakwe, MOMAN’s Brand Communication Manager said in a post titled “Energy Outlook: Importing and Liberalizing Petroleum Products in Nigeria that a significant volume of imports in the short to medium term will be influenced by several factors, including the completion and commissioning of the Dangote refinery, estimated for Q2 2023, and the restoration of the PH, Warri, and Kaduna refineries, estimated for Q1 2024.
“The successful implementation of the Autogas policy and a 20% adoption and switching rate from PMS to gas for motor transportation by Q1 2025 will also play a crucial role in reducing imports” he said
Explaining further, MOMAN said that demand growth will likely be influenced by smuggling, which will be tempered by full-price de-regulation and equalization of pricing across the sub-region. To effectively liberalize supplies, removing price control alone is not enough, and we must first expand the supply side.
“To this end, industry experts recommend opening up the supply side as set out in section 317 (8 to 11) of the PIA 2021 by encouraging private sector participation in importing refined petroleum products. This can be achieved through a transparent and inclusive process, which will help to reduce the current inefficiencies in the sector” the Association said.
