The Nigeria Midstream and Downstream Regulatory Authority (NMDRA) chief executive, Engr. Farouk Ahmed has said that Nigerian daily Petrol consumption is still on the average of 45 million and 50 million daily.
Ahmed, speaking at the sideline of the ongoing 18th Africa Downstream Energy Week with the theme ‘Alliances For Growth’ holding in Lagos, Nigeria, however, hopes that the volume could go further down after the Yuletide adding that with the current full liberalization of the sector, cross-border smuggling of the product would be discouraged.
“We see a lot of activities going on now, during the fourth quarter of the year, especially towards Christmas. During this period, the industries experienced a high volume of activities. But after this, we can see the consumption go down.
“We also hope that this price adjustment or liberalization will discourage cross-border smuggling of the product because there will be less incentive to go across the border, meaning that the product will remain in the country. After this, we can see the level between real supply and actual demand in the market”, he stated
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On the theme of the conference which is ‘Alliances for Growth, Ahmed said: “Collaboration is key and this is what the authority is trying to promote in terms of facilities among the stakeholders. Instead of having private depots all over the place, we can have a few and use them more efficiently, whether it is in terms of trucking or retail outlets. Of course, it is good to have things in abundance, but when you look at the economy of scale and the cost, you can see a lot of downtime or idle petrol stations and private depots”
According to him, collaboration or alliance will bring all the stakeholders together for the sake of efficiency and cost reduction for the consumers.
He noted that with alliances among the industry players, the cost of the product for consumers will be low. But if the infrastructures are in places where they are mostly idle, the cost of product to the consumer will be high, because every promoter is expected to recoup his investment.
