PETROAN Urges FG to Allocate 30% of Cheaper Fuel Supply

The Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) has formally requested that the Federal Government earmark a minimum of 30 percent of its recently introduced discounted petrol supply for its members. According to PETROAN President, Billy Gillis-Harry, who spoke on Arise News on Saturday, this strategic allocation would significantly bolster nationwide fuel distribution and ensure more Nigerians benefit from the price reduction. He highlighted the association's extensive retail network as a crucial asset that could enhance the Nigerian National Petroleum Company Limited's (NNPC Limited) distribution capabilities, thereby improving petrol availability across the country.

Gillis-Harry emphasized that the 30% figure was a starting point, stating, "The 30% we mentioned is actually a minimum, because we could do more depending on the dynamics NNPC sees on how we can work together. The fact is that we have over 230 million Nigerians dependent on this energy to run their daily economy. The number of NNPC retail outlets, as good as they are, may not be able to do the entire work in an efficient and expeditious manner. PETROAN has larger retail volume, which also includes NNPC retail outlets among our members." He further articulated that the government's intervention could rapidly assist Nigerians, with PETROAN playing a pivotal role in accelerating and optimizing distribution channels. He reiterated that while 30% was proposed, the exact percentage could be adjusted based on NNPC's assessment, but the association had already presented a case demonstrating the value of their involvement in making the policy effective.

Explaining the rationale behind PETROAN's request, Gillis-Harry noted that gaining access to the cheaper petrol would empower independent retail outlets to sell fuel at reduced prices while still maintaining sufficient profit margins to cover their operational expenses. He drew a distinction between PETROAN members and NNPC, explaining that unlike the state-owned oil company, which is prepared to absorb some profit losses under the initiative, independent marketers lack the financial capacity to entirely sacrifice their earnings. He elaborated, "We don’t have the deep pockets of NNPC to forego profits. The reason is simple: if we have the product already well-discounted landing at our outlets, we can sell at a much cheaper price than if we buy from other sources."

The PETROAN president clarified that the association intends to purchase the product from NNPC and then distribute it via its extensive network of member outlets, rather than receiving the petrol without cost. He described this arrangement as an extension of NNPC's mission, stating, "We’d just be an extension of NNPC’s efforts—just doing what NNPC is doing. That way, we are able to carry this same product down to the nooks and crannies of Nigeria. That is more important than having 15 stations in a city serving a population of about 3 million people. If you have an additional 1,000 or 2,000 stations in that city, distribution efficiency will be higher, and Nigerians will benefit more." He affirmed that PETROAN members would not forgo their profits, explaining, "We are not going to lose our profits; we will work out the dynamics. We will pay NNPC for the product; they don’t give us product for free. Our proposal is simply: if you have 1 billion liters to supply through this method, give us 30% (300 million liters), which we can extend to our members without making it much more expensive."

Gillis-Harry further asserted that channeling the discounted petrol through a broader array of retail outlets would enhance fuel availability nationwide and alleviate the persistent queues often observed at NNPC retail stations. He stressed the importance of addressing both availability and affordability for Nigerians. He added, "We understand the need and dynamics of servicing Nigerians with those two critical points: availability and affordability. This will not be any different. If we buy from other sources, we will sell at a higher price, causing NNPC retail outlets to be massively impacted by queues. If that product is spread around to different outlets, it enhances the purpose." He concluded, "We are only extending NNPC’s efficiency. We are certainly speaking to the government, and we expect that government will say yes because it helps in ensuring the policy works."

Addressing concerns that the discounted petrol initiative might signal a reintroduction of fuel subsidy, Gillis-Harry firmly refuted such claims. He argued that the current arrangement involves NNPC foregoing a portion of its profit, distinct from the traditional subsidy model where the government covers the disparity between the landing cost and the pump price. He explained his stance, stating, "No, I do not agree that subsidy is returning. When we say PMS is subsidized, it means landing cost—just as an example—is ₦1,350 and the government takes the shock of ₦700. That is a subsidy. In this case, the policy is simply: NNPC, out of your profit, ₦16 should be discounted. NNPC is going to buy the product from a source, either through local refineries or imports." He added that PETROAN's role would be to ensure this policy permeates all parts of Nigeria. "What we are saying as retail outlet owners is that we want to latch onto that so it becomes an extension of ensuring this policy filters down to all the nooks and crannies of Nigeria." The PETROAN president also commented on the proposed ceiling of ₦1,350 per litre for petrol landing costs, expressing [the article content was truncated here].