FG: Framework for gas equalisation will be developed after passage of PIB

The federal government says the framework to accommodate the gas supply system in the equalisation scheme will be developed after the passage of the petroleum industry bill (PIB).

Speaking with journalists in Abuja, Ahmed Bobboi, executive secretary of the Petroleum Equalisation Fund (PEF) Management Board, said equalising for gas would improve supply and boost the economy.

He also said the agency, whose mandate is to ensure uniform prices for petroleum products across the country, is being repositioned to carry out its mandate more effectively.

Established in 1975, PEF ensures price uniformity by compensating petroleum product marketers for every litre they sell, covering their respective distances from the depot.

With the decade of gas declared from 2021 to 2030, Bobboi said an equalisation scheme for gas would improve supply for the end-users.

He said: “The petroleum industry bill (PIB) is still in the national assembly which is considering most of the issues and whatever comes out from that deliberation will be the guiding point for all of us because we want to know the fate of PEF itself and then look at the mandate of the new or additional mandate.

“Once we have the legal and legislative backing, then we will come with a clear framework….If it (equalisation) is working well for petrol and the government wants to promote the use of gas, if we can take the practice to gas, we believe that it will add value to the economy in so many ways in the value chain. 

“This will help consumers accept the usage of gas and age-long use of firewood with its attendant problems and challenges and the health hazards associated as well as deforestation which causes a lot of problems in the country will stop.

“This will make the product available because we have a lot of gas in the country, it will make it affordable which will incentivise the marketers to take it to the last mile, the consumer will also be incentivised because the marketer will bring down his price to make it affordable and accessible to the consumer. This will do a lot of good to the economy.”

‘BENEFITS OF TRANSPORTING PETROL BY RAIL’

Bobboi further said that the planned transportation of petroleum products by rail will help reduce pressure on the roads and also increase the turnaround “because one rail journey will take 20 or more wagons.”

“Apart from gas development, we are also looking at the possibility of making marketers transport their products by rail because the government is revamping many of the critical rail lines,” he said.

“And if you can do that, it saves a lot of cost and reduces pressure on the roads because most state governments are complaining that the heavy-duty vehicles plying the roads are what destroys them (the roads). So, it will reduce the cost of road maintenance for the government.”