By Adewale Sanyaolu
The current fuel scarcity being witnessed in parts of the country may not abate soon due to challenges in Capital Expenditure (CAPEX), haulage and poor infrastructure across the country.
Some oil marketers who spoke yesterday, at the Midstream and Downstream Leaders Forum at the ongoing Nigeria International Energy Summit(NIES) expressed concern that the fewer numbers of trucks conveying petrol out of the depots are grossly inadequate for the emergency situation the country was contending with at the moment.
They equally posited that the low CAPEX investment by the industry was preventing some opeartors from procuring modern trucks that would be efficient for conveying petroleum products from the depot to retail outlets.
Special Adviser to the Managing Director of TotalEnergies Marketing Nigeria Plc, Mr Charles Atiomo, who listed the challenges said that following the lack of CAPEX, some operators are now cutting corners especially in the area of Health, Safety and Environement(HSE).
He said if trucks don’t meet standards, they are not meant to be on the road as the industry is not in business to kill people.
‘‘Due to lack of CAPEX, there is no money to buy trucks. Part of queues you are seeing today is caused by lack of trucks to convey products to retail outlets. I think we need to look at the Petroleum Industry Act (PIA) again to be able to unlock some of these challenges,” he said.
He also noted that for the industry to attract investment, government must create a favourable framework which will ultimately enhance competitiveness in the entire value chain.
For his part, Chief Executive Officer (CEO) OVH Energy, Mr. Hubb Stokman, said the midstream sector equally needs more CAPEX, as there are still issues around leaking pipelines which is unsafe for the environment.
Stokman lamented that issues around ageing fleet continues to create a huge bottleneck for the downstream sector, stressing that modern trucks should have anti-spill protection for the safety of everyone in the value chain.
‘‘Everybody in the downstream space must invest in CAPEX. We must improve on the state of roads because if we do, cost of operation will reduce if the roads are good,’’. He said.
In his reaction, the Managing Director of 11 Plc, Mr. Tunji Oyebanji, said one of the key objectives of the Petroleum Industry Act(PIA) was to create an enabling environment for the industry to thrive but the reality on ground today is a postponement of the implementation of the Act which has set the industry back.
He said the industry had hoped for an early transition to a fully deregulated petrol price regime which would have helped the business environment to resolve some of the issues associated with low CAPEX, shortage of petroleum products among others.
He said one of those way to encourage investment in the industry is for investors to get adequate returns on investment along the entire value chain.
Meanwhile, oil prices continued its steady rise yesterday, with Brent crude, against which Nigeria’s oil is priced hitting $115 per barrel aimed heightened tensions between Russia and Ukraine