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Don’t scrap Petroleum Equalization Fund, UFBN tells FG

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Feelers that the Federal Government plans to scrap the Petroleum Equalization Fund (PEF) has been condemned by a socio-cultural group, United for a Better Nigeria (UFBN).

The group in an interactive session with select editors and publishers hinged their objection on grounds that such action would cause more hardship for Nigerians.

PEF is an agency of the Federal Government created 43 years ago to ensure uniformity in the price of petroleum products sold across the country.

At the forum organized by oil marketers in Abuja, the Chairman of the organization, Chief Olumide Mayowa said getting rid of the services of PEF will make the price of petroleum products, food stuff and other items jump beyond the reach of average Nigerians, including, civil servants.

Mayowa said that PEF has been of immense assistance to all Nigerians because the transport and bridging claims which is paid for the movement of products across the country makes the cost of petroleum products almost the same no matter the location.

According to him “If you scrap PEF and it means total deregulation and transporters will have no choice but to transfer the cost of the movement of products to the consumers and that will be unfortunate”.

“I tell you that the least a liter of petrol will cost when total deregulation is implemented will be N250 per litre in cities like Abuja and N350 per litre for Maiduguri and other towns in the far North.

“Do you deregulate to limit your own people,’’ the UBFN boss queried.

He wondered the grounds for the agitation to get rid of PEF since the pipelines and the rail lines across the country were not functional.

Continuing, he argued that “Even if they are functional, what security guarantees are there to ensure that products get to their destinations without militants and other restive groups blowing up the pipelines or cause train accidents”.

“I heard that the Independent Petroleum Marketers have set up a task force that will ensure the safety of products being piped and am wondering what they hope to achieve considering the fact that almost all the security agencies have been experiencing an uphill task in efforts to achieve the same feat.

“For us the best thing is for the government to strengthen PEF for it to function better. It took six weeks to complete a 3.6 kilometer runway at Abuja international airport. I wonder how many years it will take to fix the hundreds of kilometers of rail lines and secure hundreds of kilometers of pipelines for the movement of products, Mayowa said.

He observed that road transport will continue to be the only means for distributing petroleum products to some states in the far North because there is no pipeline linking Sokoto State and Borno State.

“As you know the only loading areas in Nigeria are in Lagos, Port Harcourt and Calabar. Without loading and transporting by road how will people in the far North receive supply of petroleum products.

“Apart from that PEF is the only organizations that keeps accurate and up-to-date records of all loadings across the country, coupled with the fact that the agency provides information about the smuggling of products across the borders.

“Government should not forget that the attempt at full deregulation soon after this administration assumed office led to increase in the pump price of petrol. That should serve as a lesson while raising issues on the desirability or not of PEF. I do not think it is necessary to touch that organization, at least for now,’’ Mayowa said.

Furthermore, he said that getting rid of the services of PEF will translate into large scale unemployment, tough time for industries, setback for macro-economic activities and high cost of governance.

“I know 10 marketers who own fleet of 500 trucks each. It implies that at least 5,000 drivers will be at the risk of losing their jobs. In the same token, governance will cost more because money that would have been invested in development programs will be spent fueling vehicles.

I think there is no point getting rid of PEF, at least, for now,’’ Mayowa said.


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