As the pressure for the removal of fuel subsidies intensifies, oil marketers are seeking other alternatives to cushion the effect of the proposed removal of Premium Motor Spirit, popularly called petrol.
Naija News reports that the oil markers under the aegis of the Independent Petroleum Marketers Association of Nigeria (IPMAN) have called on the federal government to intervene in a proposal to the Central Bank of Nigeria (CBN) over a loan worth N250 billion.
It was gathered from The Punch that the IPMAN President, Chinedu Okonkwo in a letter dated April 3 addressed to the finance minister said the N250 billion is an intervention fund for the National Gas Expansion Programme as loans to the vehicle owner to acquire gas conversion kit.
Their preposition comes after the Federal Government pegged June 2023 as the date for the removal of fuel subsidy, ahead of the next administration’s decision on if or not to work with fuel subsidy.
However, the prepositions are that Nigerians might pay about N750/litre for petrol if the Federal Government removes the subsidy by June this year.
But oil marketers in their move to ameliorate the effect of the proposed subsidy removal have proposed to build about 30,000 gas stations.
According to the IPMAN president, marketers are ready to deploy gas dispensers to 30,000 filling stations nationwide to cushion the impact of fuel subsidy removal.
He explained that marketers are optimistic that the move on gas expansion would provide a cushion to Nigerians from the shock of high petrol prices once the subsidy is removed and would significantly reduce the need for foreign exchange to import petrol.
Okonkwo in the letter signed by himself and addressed to the minister of finance submitted that “We are writing to request an audience with you to present a palliative solution to cushion the impact of the removal of the unsustainable petrol subsidy.
“Our partners, Gas Analytics & Solutions Ltd, have an agreement with the independent Petroleum Marketers Association of Nigeria to co-locate natural gas dispensers on our network of over 30,000 filling stations in Nigeria.
“This collaboration with IPMAN presents the most economic and expedient platform to deploy the necessary infrastructure to support a fast national roll-out of CNG (Compressed Natural Gas) for vehicles.
“Furthermore, CNG emits 30 to 60 per cent less Green House Gases than petrol and diesel, making it more appealing to attracting additional financing from international and regional development finance institutions that are disposed to supporting natural gas utilisation projects compared to petrol refineries.”
The IPMAN boss advanced that the Nigeria Midstream Downstream Petroleum Regulatory Authority (NIRSAL ) and the Gas Aggregation Company of Nigeria have set up a joint working committee to provide the permits, approvals, and natural gas feedstock as required.
“What is left is the support of the Central Bank of Nigeria to provide access to the Gas Expansion Fund for vehicles, Keke, and truck owners to access loans to finance the acquisition of natural gas conversion kits,” the marketers maintained.
They revealed that they had applied to CBN through the NIRSAL microfinance bank for a partnership to develop a finance scheme for qualified Nigerians to access the gas expansion facility to convert their vehicles and need the support of the federal ministry to conclude with CBN NIRSAL Microfinance Bank.
The group noted that the Gas Expansion Fund was proposed to support the increased utilisation of natural gas in Nigeria, and access to the funds by qualified vehicle owners would support and justify IPMAN members making the required investment along the natural gas value chain to deliver gas to vehicles.
IPMAN stated that “Without a large pool of CNG customers, IPMAN will not be able to raise the funds required to set up CNG filling stations.
“We believe that with the support of the Ministry of Finance, IPMAN’s partnership with Gas Analytics will provide a platform that can in a matter of a few months cushion the impact of petrol subsidy removal and significantly reduce the need for foreign exchange to import petrol.
“We request an audience with you to discuss this further and present our proposal. We looking forward to hearing from you soon. Thank you for your time and consideration.”