Fuel marketers and the Trade Union Congress of Nigeria, expresses their opposition to a provision in the Senate version of the Petroleum Industry Bill that allowed only active refinery license holders to import petroleum products into the country.
Subsection (8) of section 317 of the bill says the Nigerian Midstream and Downstream Petroleum Regulatory Authority shall apply the backward integration policy in the downstream petroleum sector to encourage investment in local refining.
To support this, license to import any product shortfalls shall be assigned only to companies with active local refining licenses. Import volume to be allocated between participants based on their respective production in the preceding quarter.
The Major Oil Marketers Association of Nigeria and the Depot and Petroleum Products Marketers Association of Nigeria notes in a joint statement that the clause restricted the license to import all refined products into the country to a very small number of local refiners.
The marketers commended the government’s plan to repair all existing refineries in a bid to boost refining capacity.
According to the marketers, any provision that does not guarantee a free and open market will give room to price inefficiencies and eventually kill off small businesses in the downstream sector.
