‘You Can’t Deregulate And Fix Price Of Petrol’ | Independent Newspapers Limited
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‘You Can’t Deregulate And Fix Price Of Petrol’

Posted: Jun 14, 2016 at 2:07 pm   /   by   /   comments (0)

The Managing Director of PetroCam Filling Stations, Mr. Patrick Iloh, in an interview with some energy correspondents, explained what he described as an aberration in the new Federal Government’s policy of deregulating Premium Motor Spirit (PMS), otherwise called petrol, and at the same time fixing the price of the product. CHARLES OKONJI captured the interview.


Prior to this current deregulation of the nation’s downstream sector of the petroleum industry, a lot of people, particularly the labour union, kicked against it because of what they perceived as the breeding ground for sharp practices. Now that the sector has been deregulated, how do you think the Federal Government can checkmate any risk of sharp practices by marketers?

To be honest, the Federal Government should hands off completely from downstream sector. Sharp practices will not work because in a deregulated market, it has to be a free entry and exist. If you do a sharp practice and you are not giving a measure of value to your customers, people will move to other places. This is the time for competition. The recent adjustment is the right step.

However, the Federal Government should not put a cap. The problem is that the government is putting a cap on how much to sell, which is between N135 per litre and N145 per litre. Price will adjust on function of market forces and if you are putting a cap into it, it means it is not deregulation. So the best thing for Nigeria is to let people fix their prices and it will be a function of competition. The question marketers need to ask is: ‘how am I able to be effective to bring my product at a cheaper price?’

Nobody regulates cows, tomatoes and diesel. So, why should the Federal Government fix the price of petrol? The more the Federal Government puts its hands on the prices of petrol, the more inefficiency it will bring into the system. Let the Nigerian National Petroleum Corporation (NNPC) bring a lot of products and sell in their stations at their own best price. If the government cannot do it, then why go to other people? We are more of a trader. We trade on the water and sell to some big names like Oando and so on. People cannot see our activities in the water and that so we decided to trade on the land too.

 What prompted you into investing in solar-power filling station?

I promised the nation that I am going to build a Mega Station which will have positive impact in the society without relying on grid supply to run the filling station. This is a major feature of this filling station is that the filling station has taken a new dimension in terms of values, beauty and presentation. The filling station has gas skid which can refill all cylinders.

The major reason for this is that the ecosystem is being destroyed and we are willing to protect the environment. Deforestation through wood cutting should stop and be discouraged. Usage of kerosene should be played down and gas should take over. We have actually invested in our own little way by making sure every household is able to use gas with access to fill 3kg, 5kg, 6kg, 12.5kg, 25kg and 50 kg cylinders depending on their capability. We also have a digital scale in which if you cannot afford to buy 3kg, you can buy lesser. Other utensils of gas is sold at PetroCam

While some investors are complaining of paucity of foreign exchange, you seem not to be feeling it. What is the secret behind your massive investment at this crucial time?

We started the project before now. Agreed there is a critical shortage of forex and I must say that I am part of the forex regime. I must tell you, government is looking into it. They are bringing in the flexible forex regime and we are waiting for the guideline. I am very confident that in the next couple of weeks, it will be something everybody will be able to key into. Forex will not be an issue, though it may be high but it will rise and come down. I am very confident because the population is high and people want to come and invest in Nigeria and at the end of the day, a lot of inflow will come into Nigeria in terms of foreign investment and everybody will be able to tap into it.

Is PetroCam wholly Nigerian firm or it has foreign affiliates?

PetroCam is a firm from South Africa and it was moved to Nigeria in 2011. The real promoter of PetroCam is Shuran Ganny and we are partners but the major thing was that because PetroCam is an African company, we are all over Africa. Though we might not be physically present but we trade in all African countries. Our experience has widely travelled. We have been able to see new things and imbibe those things that will make the our customers have the best.

What are other relevant details of the pumps including capacity?

We have 11 underground tanks, 10 for Premium Motor Spirit (PMS) otherwise called petrol and one for Automobile Gas Oil (AGO) otherwise called diesel. We also have five gas plants with digital scale, which can fill four cylinders at a time. We can store minimum of 600,000 litres of gasoline in the facility. We can sell continuously for two days at full bloom without any shortage. We also have 15 trucks in which we apply, in making sure all the trucks are waiting to discharge. We have the space pumps which can dispense at a faster rate and all the pumps are automated. We have the resources to face the challenges of the 21st century in terms of petroleum products and there is no power failure because we are running on a solar.

 What is the capacity of the gas skid?

The capacity of the gas skid is 5000 Metric Tonnes (MT) and it is in compliance with the regulation of the Department of Petroleum Resources (DPR).

What is the cost of the filling station and what inspires you to venture into such business?

The station should run into several millions of naira and more stations are going to come as soon as possible. This is what I have been doing right from the time I was in England. I have been selling to Tescos, Summerfill and so on. So when I came back to Nigeria in 2010, my job brought me back and I started working for that company. I left to start my own. I have seen the filling stations, which people built and I have seen that people are not getting values for money in terms of dispensing products. A filling station must have a shop in which you can do your alignment, coffee shop and coffee bar and gas. So that was what gave me reasons to venture into it.