Nigeria’s fuel regulator said on Monday it has issued gasoline import contracts for the second quarter, the first tender result since a public outcry forced the government to back down on plans to scrap consumer petrol subsidies in January.
Permits to import a total of 4.8 billion litres of gasoline in the second quarter of this year were issued to 42 marketers, the Petroleum Products Pricing Regulatory Agency (PPPRA) said in a statement.
Local units of oil majors Exxon Mobil and Total , state-owned energy firm NNPC and Nigerian company Oando were among those approved to import gasoline. Several smaller local firms also made the list.
The gasoline market has been awaiting clarity from Africa’s largest crude oil exporter on how the new import regime will work since the government attempted to remove petrol import subsidies on Jan. 1, but was forced to partly reinstate them.
Nigeria’s government pays importers to bring in refined gasoline and then sells it to the public at knocked down prices, a huge drain on the treasury. Efforts to reform or scrap the system have repeatedly been scuppered by public opposition.
At the end of a week of mass protests against a near doubling in fuel costs, the government also ordered several probes into graft in the subsidy scheme and other areas of the oil industry, a major focus of public anger.
Nigeria’s gasoline import business is one of the key areas within Africa’s largest energy industry that has been riddled with corruption, according to government officials and oil sector audits.
Parliament is investigating a $4 billion discrepancy between the amount paid in gasoline subsidies last year and the amount of fuel actually brought into the country.
The head of the parliamentary committee probing the subsidy, Farouk Lawan, told Reuters last month that Nigeria’s daily consumption of petrol is 35 million litres, yet importers were being paid for 59 million litres a day. The balance of gasoline was either being smuggled out of the country or never existed, Lawan said.
PPPRA is among several government departments under another investigation started by the Economic and Financial Crimes Commission (EFCC) following the fuel subsidy row.
A petroleum revenue task force, led by 2011 presidential aspirant and former EFCC chief Nuhu Ribadu, also began this month probing inconsistencies with government oil earnings.
Several audits and reports in recent years highlighting problems within Nigeria’s oil industry have been ignored and no senior member of the state oil company or oil ministry has ever been fired or arrested.
PPPRA in its statement named the beneficiaries of the gasoline tender for the first time and issued importers with a warning to keep to contracted terms, in an apparent effort to improve transparency.
“The volumes to be supplied into the system for Q2 2012 is based on marketers’ performance in the past and their ability to secure the needed financing,” the PPPRA statement, which was published in local newspapers, said.
“Failure of a company to deliver the approved volume shall render the company liable for exclusion from the scheme for two successive quarters or more, aside from payment of appropriate re-engagement fees.”
Africa’s largest oil exporter had been relying on exchanges of crude for gasoline in recent weeks as no new tenders had been allocated since subsidies were removed.
