The Chief Executive (CE) of the National Petroleum Authority, (NPA), Dr. Mustapha Abdul-Hamid has told Civil Society Organisations (CSOs) in the energy sector, that government is in the process of reviewing the price deregulation regime of the petroleum sector, which has been in effect since 2015.
He said this last week Thursday when he met them as part of his stakeholder engagements.
“Even before I took office as CE of the NPA, plans were already in place to review the deregulation policy which has been in effect since 2015” Dr. Abdul-Hamid said.
“I have duly signed off on the decision and the review committee will begin sitting soon” he added.
Dr. Abdul-Hamid said this in response to concerns by the energy sector CSOs, that after six years of the operation of the deregulation policy, it has not been reviewed to tell us if it is a policy that has had a positive or negative effect on the downstream petroleum industry and the economy as a whole.
The 12-member committee has representatives from the Ministry of Energy, the Chamber of Bulk Oil Distributors (CBOD), the Association of Oil Marketing Companies (AOMCs), the LPG Marketing Companies (LPGMCs) and the NPA.
While commending government for the initiative to review the petroleum deregulation policy, the CSOs lamented their exclusion form the committee.
They wondered why the beneficiaries of the policy, that is, CBOD, AOMC and LPGMC were the same people being asked to review it.
Dr. Abdul-Hamid promised to look into their complaint and seek appropriate advice on the way forward.
In the meantime, he has asked them to submit proposals and memoranda to the committee for consideration. “You do not have to be physically present on a committee to make your views heard. You are welcome to submit proposals and memoranda and they will be factored into the deliberations of the committee” he said.
Deregulation is the removal of government controls from an industry or sector, to allow for a free and efficient market place; the lifting of government controls, and to allow for the forces of demand and supply to dictate the prices of goods and services.
The process to deregulate the pricing of petroleum products had been evolving from 2005 when the NPA was set up until June 15, 2015, when complete deregulation was achieved. The introduction of the deregulation policy by government was also meant to reduce the huge losses incurred by BDCs and OMCs which deprived them of the needed capital to make their businesses viable.
This also compelled government to intervene with subsidies, which also affected other developmental needs.
The CE, whilst assuring them of frequent engagements and an open-door policy, appealed to them not to take entrenched positions since “we are partners in development.”
The CSOs expressed their excitement about the CE’s proactive policy of engagement and assured him of their ‘full cooperation” in promoting a robust and efficient downstream petroleum industry.
The CSOs in attendance were Institute of Energy Security (IES), African Center for Energy Policy (ACEP), and the Chamber of Petroleum Consumers (COPEC). Others were, Consumer Protection Agency (CPA), the Institute for Energy Policy and Research and the Bureau of Public Safety.