DOWNSTREAM
Oyebanji
Fuel Side of the Downstream Sector is a Complete Mess - MD, 11 Plc
T
he Ma na g ing Director of 11Plc, for merly ca l led Mobil Niger ia Plc a nd Chairmen, Major Oil Marketers Association of Nigeria (M O M A N), Tu nj i O y e b a nj i , ha s sa id that the f uel side of the dow nstrea m sector of the Nigerian oil and gas industry is a complete mess. He stated this i n a n exclusive i nter v iew w ith Major waves Energ y Report, on the side l i ne of the Niger ia n Oil and Gas C onference, which was held in A buja early in July. O y e b a nji , w h o l e d a p a n e l discussion on,” Harnessing the Oppor tunities to Draw Niger ia C loser to Energ y S ecur ity” du r i n g t h e C o n fe r e n c e, s a i d that some of the operators i n the dow nstrea m sector of the Niger ia n oi l a nd ga s i ndustr y a re i n debt a nd a re una ble to ser v ice thei r loa ns, thei r ta n k farms being confisticated by the A sset Management C orporation of Niger ia (A MC ON), leav i ng on ly the brave ones ma na g i ng to i nve st i n other a rea s l i ke
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Majorwaves Energy Report
Liquefied Petroleum Gas (L P G), b el iev i ng t hat t h i ng s w i l l i mprove i n the f utu re. He ident i f ie d i n f lat ion, st a f f continuous demand for increase in sa la r ies, increment in charges by government agencies a nd pr ice f i x i ng of petroleum products by the gover n ment a s some of the factors affecting the dow n st re a m s e ctor. O yeb a nji bla med over reg ulation of the sector a s the rea son why I nte r n at i o n a l O i l C o mp a n i e s (IOC) sold their a ssets, noting t h at even t ho s e who b ou g ht some of these a ssets, are d ivesti ng. “I want to be extremely candid a s fa r a s the f uel side of the dow nstrea m is concer ned. It is a complete mess. It’s a disaster. Ma ny people a re getting out of the business. A MCON is selling p e ople’s t a n k fa r m s b e c au s e t hey c a n’t s er v ic e t he lo a n s t h e y h ave t a ke n . T h e b r ave ones a re sti l l tr y i ng to i nvest i n cer ta i n a rea s l i ke L PG a nd th i ng s l i ke that, hopi ng that
AUGUST 2019, Vol 2 No 5
thi ngs wou ld get better i n the f utu re. But cer ta i n ly r ig ht now, the tr ue ma rg i ns i n the retail side of it are always thin a nd operators there have to be ver y eff icient there to sur v ive. B ut c u r r e nt l y, t h e s it u at i o n is ver y d i re because i n f lation i s there. Sta f fs a re a lways a s k i n g fo r s a l a r y i n c r e a s e s; v a r iou s gove r n me nt a ge nc ie s a re i ncrea si ng the cha rges on us for a l most ever y thi ng. A nd yet, the ma rg i ns we have a re f i xed by the gover n ment. S o, under those circumstances, you see, what you find is that most of the IO C s have lef t a nd even the people who boug ht those companies are also divesting. So nobody needs to tell you. If the thing wa s sweet, people would stay i n the busi nes s,” he sa id. Speaking on the topic discussed at the pa nel ses sion, he sa id that he tr ied to get the v iews o f t h e p a n e l i s t s o n w h et h e r there wa s energ y secu r ity i n the countr y or not,
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