The Petroleum Products Retail Outlet Owners Association of Nigeria (PETROAN) has clarified its request for a ₦100 billion grant from President Bola Tinubu, emphasizing that it is not seeking free money but a loan to support its members amid the challenges posed by the removal of fuel subsidies.
In a statement, PETROAN President Billy Gillis-Harry explained that the requested fund is intended as seed capital for an energy bank. He noted that this would enable members to access single-digit interest loans, reduce fuel prices, and prevent the closure of up to 10,000 marketers’ businesses threatened by high operational costs.
“We didn’t say the government should give us free money,” Gillis-Harry stated. “We said, ‘Put it in the energy bank and give it to us as a single-digit interest loan.’ With that, fuel prices will come down, and the fund will recycle and grow significantly within a few years.”
The removal of fuel subsidies by President Tinubu in 2023 led to a steep rise in petroleum product costs. The cost of lifting a 33,000-liter truck increased from ₦7 million in May 2023 to ₦30 million by October 2024, forcing some marketers out of business. Many retailers now pool resources to purchase a single truck of petrol for distribution among their stations.
To mitigate these challenges, PETROAN emphasized the need for government intervention through the proposed energy bank, which Gillis-Harry believes would foster a more sustainable downstream sector and reduce dependence on high-interest loans from commercial banks.
“We are paying between 36% and 40% interest on loans from banks,” he lamented. “This makes it impossible to offer cheaper fuel prices. A 9% interest rate through an energy bank would transform the industry, benefiting Nigerian consumers.”
Similarly, Hammed Fashola, National Vice President of the Independent Petroleum Marketers Association of Nigeria (IPMAN), advocated for establishing a dedicated oil and gas bank akin to the Bank of Industry. He argued that such a bank would better understand the financial needs of petroleum marketers and support the sector’s growth.
Gillis-Harry further recommended that the government prioritize investment in critical infrastructure, such as refineries, pipelines, and storage facilities, to improve local refining capacity. He also urged collaboration with neighboring countries to tackle smuggling and called for the allocation of crude oil to local refineries to boost production and reduce reliance on imports.
Reflecting on the sector’s progress, Gillis-Harry noted that 2024 witnessed significant developments, including the rehabilitation of the Port Harcourt Refinery and the operational commencement of the Dangote Refinery. He expressed optimism about the sector’s future, highlighting the potential for growth and sustainability despite lingering challenges.
“Stakeholders must remain adaptable, innovative, and committed to sustainable development as we navigate the energy transition,” he concluded, urging the government to consider privatizing the Warri and Port Harcourt refineries to unlock their full potential.
4o