Low Supply From NNPC Depot Heightens Fuel Scarcity

The long fuel queues which reemerged in many parts of Lagos and neighbouring Ogun and Oyo states, and intensified in the federal capital territory, Abuja, and other parts of the country intensified yesterday, leaving passengers stranded across the states.


This is as fuel marketers continued to lift the product from private depots as depot operators said there was a shortage in supply from the supplier of last resort, which is the Nigerian National Petroleum Company (NNPC) Limited.

LEADERSHIP reports that the NNPC’s Atlas Cove facility, which supplies petrol to a number of depots, including Ibadan, Ilorin, Ejigbo and Mosinmi, has been down, forcing the country to rely on a number of private depots. Presently, marketers depend on private depots along Apapa, Abule-Ado and the Lekki Free Trade zones in Lagos.

Some people in the know have hinted that the continuous lack of supply from NNPC depot indicates a gradual winding down of the NNPC operations as a government agency ahead of its unveiling as a limited liability company next month.


Group managing director of the NNPC, Mele Kyari, had announced to business leaders across the company’s value chain that the company would begin operations as a limited liability company on July 1.

A close source told LEADERSHIP on condition of anonymity that it means the NNPC Ltd will begin to operate like any private company out to make profit. How can it continue to offer subsidies if it must make profit? the source queried.

The few filling stations still dispensing the product sold higher than the approved N165 per litre, at between N180 and N210.


However, the federal government has warned marketers not to sell petrol above official N165 per litre as stipulated in the petroleum product pricing template.

The government also advised Nigerians against panic buying of PMS, disclosing that the country currently had over two billion litres of PMS in various depots.

This was made known by the Nigerian Midstream and Downstream Petroleum Regulatory Authority, the NNPC Ltd and the Pipelines and Product Marketing Company after their visit to jetties in Apapa, Lagos, yesterday.

The depots visited by the top officials of the agencies were NIPCO Depot and TotalEnergies Depot.
Executive director, Distribution Systems, Storage and Retail Infrastructure, NMDPRA, Mr. Ugbugo Ukoha, said petrol was a regulated product and urged marketers to comply with the pricing template.

Ukoha said the conflict between Russia and Ukraine had led to an increment in the cost of Automotive Gas Oil (diesel) which was a critical product used in transporting of petroleum products from the depots to the retail outlets.

He said: “So, when we observed that this poses a big challenge in the movement of other products, we made the representation to the minister of state for petroleum and Mr President graciously approved that the freight rate for trucks be increased.

“There’s a N10 addition which we will apply to the different routes to enable trucks to move to docks easily with less burden.

“With these kinds of efforts from the government, we can only continue to appeal to operators within this industry to play by the rules. PMS is a regulated product and the prices are fixed. The ex-depot price is known. The pump price remains N165 and the authority is ever ready to enforce those rules.So, we will continue to urge Nigerians to keep within these operating rules. ”

Ukoha said the focus of the stakeholders in the next few days would be to close the supply gaps and resolve the ongoing scarcity of petrol as soon as possible.
Similarly, group executive director, Downstream, NNPC Ltd. Mr. Adetunji Adeyemi, said the purpose of the visit to the depots was to get first-hand information on the challenges responsible for the current scarcity.


Adeyemi said despite the challenges globally in terms of the supply chain, NNPC had continued to provide petroleum products, specifically PMS, to Nigerians.

“Today we have about two billion litres of PMS in-country which is about 34 days sufficiency. So, there is sufficient petrol in the country.

“We are working with the entire stakeholders and players in the downstream sector to ensure that this product gets to the distribution channels and also the stations.

“We want Nigerians to continue to enjoy free flow of petroleum products,” he said.


Managing director, PPMC, Mr. Isiyaku Abdullahi, said the company had been supporting transporters and marketers with diesel in the form of palliatives to ensure the smooth distribution of PMS to ameliorate the suffering of Nigerians.

Abdullahi said three vessels carrying about 60 metric tonnes of PMS were currently discharging at the Apapa jetty which would be further transported to Lagos and other parts of the country to restore normalcy.


On their parts, Mr Suresh Kumar, managing director, NIPCO, and Mr Ernest Umunna, site manager, TotalEnergies, assured Nigerians of product availability in their depots.
They also promised to carry out 24-hour trucking-out operations to ensure that the scarcity in Lagos was resolved within the next few days.

Meanwhile, member companies of the Depot and Petroleum Products Marketers’ Association of Nigeria (DAPPMAN) have complained that the cost of petroleum products purchase and handling had escalated and was eroding their profit margin.

Though the association empathised with the public, it, however, blamed the suspension of the Petroleum Industry Act implementation for creating hiccups in the system.


In a statement released yesterday in Lagos by Olufemi Adebayo Adewole, executive secretary, DAPPMAN, the Association lamented the current setback in the distribution and supply of petrol at the various stations dispensing at N165 per litre.

According to Adewole, the on-going Russia-Ukraine War has had an adverse impact on the international prices of fuel and food supply, resulting in a corresponding increase in local prices of goods and services.

The above situation, DAPPMAN noted, has had its adverse effects on the operating cost of managing the various petroleum products depots in Nigeria.

“You would note that the petrol we supply is sourced solely from NNPC Limited’s marketing subsidiary, Petroleum Products Marketing Company Limited (PPMC), for our onward sale to the public at the regulated price of N165 per litre.

“This purchase from the PPMC is achieved through funds sourced with high bank interest charges, alongside increased costs of hiring vessels utilized in the delivery of fuel cargoes to our depots.

” This is coupled with the intense scarcity of bunker fuel for running these vessels with increase in the cost of diesel used in powering equipment and machineries in our depots and retail outlets.” added the statement.

Offering further explanation, Adewole said that over time, depot owners and the government had struggled to sustain supply of petrol at the current pump price of N165 per litre despite the huge subsidy cost to government and abysmal or no profit margins to the depot owners.


However, he said, “But for its suspension, the implementation of the Petroleum Industry Act 2021 would have provided an ideal enabling environment by creating the free market in which demand and supply would affect fuel pump price.”

The association however assured the public that Depot Owners, working tenaciously in concert with NNPC Limited, through its marketing subsidiary, will continue to ensure availability of products nationwide.

Meanwhile, the fuel scarcity which hit Lagos State on Monday, continued yesterday as some of the filling stations on Lagos mainland ran out of stock, LEADERSHIP learnt.
The few filling stations selling fuel on the mainland, when LEADERSHIP visited, were selling between N170 and N200 per litre while those who bought in jerry cans were made to pay extra N100.

Along Oba-Akran area of Ikeja, the state capital, about three filling stations on the axis which included AP, Mobil Filling stations and another private filling station were selling at the actual pump price as at the time LEADERSHIP visited, although, there were long queues in the filling stations, causing heavy traffic along the axis this morning.

There were also long queues at the filling stations around Agege, Abule-Egba and Iyana-Ipaja corridors of Lagos, causing heavy traffic.
Mobil Filling station at Abule-Egba was equally selling, and the queues had subsided by yesterday evening when our correspondent visited.


The NNPC filling station along Ekoro Road, Abule-Egba ran out of stock and couldn’t sell any fuel yesterday, although Rab Oil Petrol Station that was on the same axis had fuel but was selling at N180 per litre.

Some filling stations within Lagos hinterland were also selling between N170 and N200, even though the pump price on the fuel dispensing machine read N165.

On Mobolaji Bank-Anthony Way, Maryland, Total Filling Station was selling fuel, with long queues affecting traffic on the axis by the time our correspondent visited while the two other private filling stations on the axis were not selling.

On Lagos Island, the situation is not anything different from what was happening on the mainland, although filling stations on this axis stuck to government regulated pump price.


Earlier, the chairman of the Lagos State chapter of the Independent Petroleum Marketers Association of Nigeria(IPMAN), Mr. Akin Akinriade, in a telephone conversation with our correspondent, said since December 2021, the Nigerian National Petroleum Company,(NNPC) Limited has not supplied products to the Satellite depot, Ejigbo in Lagos.
He said, in the last six months, marketers buy products from private depots who are now selling above government approved ex-depot prices.


According to him, NNPC approved ex-depot prices is N148 per litre but now private depots are selling between N162 and N165 per litre while regulated pump price is N165.
While denying insinuation that leadership of IPMAN had directed members to shut down their outlets, he said some of them had shut down because they could not afford to restock.


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