15% Petrol Import Duty: Marketers Say Local Refineries Can Now Breathe

The Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) has called on the Nigerian National Petroleum Company Limited (NNPC) to ensure the availability of crude oil to local refineries. This is crucial for the success of the federal government’s 15 per cent duty on imported fuels policy.

The national president of PETROAN, Dr Billy Harry, speaking during a courtesy visit to Dr Chinyere Igwe, the new pro-chancellor and chairman of the Governing Council of Ignatius Ajuru University of Education, PH, commended President Bola Tinubu for approving a 15 per cent import duty on petrol and diesel.

He noted that this policy aims to protect domestic refineries, stabilise the downstream oil market, and promote energy security.

Billy-Harry highlighted the benefits of this approval, including increased local refining capacity, improved price stability, and enhanced energy security. He noted that this policy will boost local refining, promote economic growth, create more job opportunities, and create a level playing field for domestic refineries.

The benefits of this policy include increased local refining capacity, reduced dependence on imported fuel, improved price stability, enhanced energy security, a a boost to the local economy, benefits to foreign reserves, benefits to Naira gaining strength, and attracting investors. The potential disadvantages include a potential price increase, loss of jobs on the side of importing firms, and short-term challenges.

He emphasised that the benefits of this policy will outweigh the potential disadvantages.

However, he called on regulatory agencies such as the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) to be on red alert against monopoly, warning that if local refineries are not adequately regulated, it could lead to a monopoly that might harm the market.

He noted that importers of petroleum products, which were a price check mechanism against profiteering, will be out of business if not properly managed. Instead, he urged importers of petroleum products to look inwards towards patronising local refineries.

The new policy has also prompted NNPC to seek private partners to manage the four nation-owned refineries.

According to the NNPC group chief executive officer, Bayo Ojulari, the company is looking for technical equity partners to help revive its long-dormant refineries. Despite years of heavy investment, the refineries have yet to resume operations. This move is crucial to Nigeria’s long-term energy security and could transform the country from a fuel importer to a net exporter.

Dr Billy Harry also calls on NNPC to complete the partnership agreement very soon and start production at Nigeria’s refineries before December to avert fuel scarcity or price hike during the Yuletide season. This timely action will help ensure a stable supply of petroleum products and support the country’s economic growth.

The PETROAN pledged to support Ignatius Ajuru University of Education in bringing industry experience to the classroom through pro bono services.

The association is willing to collaborate with the university to develop new programs that suit Petroleum Retailing, Marketing, and Energy Management.

PETROAN also declared its willingness to accept all Ignatius Ajuru students for IT industrial training in petroleum marketing-related courses. It welcomes them for excursions to stations, depots, and refineries to gain vast industry knowledge.