Amid the free petroleum products distribution embarked upon by the Dangote Refinery, Tank Farms operators and the Organized Private Sector (OPS) have disagreed over implications to the Downstream Sector of the economy, which might include jobs and investment losses.

Recall that the Dangote Refinery recently announced the commencement of a 4,000 CNG Truck free fuel distribution, drawing the ire of petroleum marketers and petroleum tanker driver’s association who accused the refinery operators of trying to monopolize the fuel supply trade.

Speaking with the Nigerian Tribune exclusively, the Chairman/Chief Executive Officer of Integrated Oil & Gas, Captain Emmanuel Ihenacho, explained that jobs and investment losses could arise if Dangote Refinery and fuel marketers don’t find a common ground to co-exist.

According to Captain Ihenacho who also doubles as the CEO of Genesis Shipping, “Job losses and slump in investment is bound to happen if Tank Farm owners are no longer being able to sell their products.

“What is happening currently in the Downstream Sector is something that we have never seen before. It’s a complete emasculation of a class of business people. The normal thing is for everybody to canvass for their market share, not a situation where one single entity aims to take over the market.

“From time immemorial, we have people who produce and refine petroleum products. We have those who distribute. We have those who store petroleum products. Everybody has their roles marked out. Their idea is really that everybody has to co-exist.

“There is nothing to be gained when one person aims to take over the market and every other person just park up. Jobs will be lost. Investments will be lost. It’s important we all find a common ground to co-exist,” he said.

Faulting the Tank Farms operators, the Chief Executive of the Centre for the Promotion of Private Enterprise (CPPE), Dr. Muda Yusuf explained that the Tank Farms, petroleum depot owners and petroleum tankers associations must align with changing dynamics to remain in business, stating that jobs or investment losses might be a sacrifice that the country might have to undertake to wrest the economy from an import dependent cycle.

In the words of Dr. Muda Yusuf: “The reality is that the Oil & Gas sector is witnessing a major disruption. In any economy all over the world, if there is any disruption, there will be winners and there will be losers.

“We have seen disruptions for instance in ICT. Where are the Motorola’s, the Nokia 3310, the Sagem phones of those early telecommunication years in Nigeria? Where are they today?”

“We have also seen disruptions in the financial sector. Look at what the fintech companies are doing to the commercial banks. Look at the kind of competition the fintech’s are creating for the commercial banks. Do you know that some of the fintech’s firms are doing more businesses than some of our conventional banks?

“So, it is normal for the economy to evolve. If as an investor, you fail to follow the trend or prevailing business strategy that ensures your survival, such business is bound to have issues.

“The reality is that most of the Tank Farms, Petroleum Depots and petroleum distribution associations in Nigeria are product of an import dependent Downstream Sector. Many of them are also dependent on all manners of atrocities that have shaped our oil and gas sector in the past, i.e. subsidy scam, fuel scarcity and others. Many of them are products of a dysfunctional system.

“Now that Nigeria is transiting from an import dependent regime with the likes of the Dangote Refinery now exporting petroleum products as far as the United States of America, and also refining petroleum products for domestic use here in Nigeria, those that have benefited for years from the import dependent regime of petroleum products will normally complain.

“You cannot invest $20bn Dollars in a business and you don’t take steps to manage or domesticate your supply chain. Imagine you having such investment and petroleum tankers association hold you to ransom? If the petroleum tanker associations refuse to lift your petroleum products, what will you do?

“So, there is likely to be loss of jobs in a disruption environment, but don’t forget that new jobs have been created in the refinery.

“People need to come to the reality that the current reforms are changing the landscape in the oil and gas sector, even in the larger economy. Why are some business leaving and others are coming in?

“People are talking about monopoly, but is Dangote Refinery stopping the other refineries owned by the NNPCL from working? No. is Dangote Refinery stopping fuel importation? Are people not still importing? Is it a crime that Dangote Refinery is devising a strategy to be ahead competitively? No. what is the essence of competition? Is it not to be ahead of your rivals?

“If there are proven case of a breach of competition law, the Federal Competition & Consumer Protection Commission (FCCPC) is there for aggrieved parties to seek redress. The Tank Farm owners or marketers should take their case to the FCCPC if they feel aggrieved by what Dangote Refinery is doing. For me, there is nothing wrong in what Dangote Refinery has done so far.

“Look at cement production and distribution. Dangote Cement produces cement, and the cement is distributed by trucks that have Dangote Cement boldly written on them. Same thing with BUA Cement.

“Also take a look at soft drink production. When Coca-Cola produces, the company distributes its products with its trucks. Why has there not been outcry over the distribution of cement by Dangote Trucks or distribution of Coca-Cola by Nigerian Bottling Company trucks?

“The outcry over Dangote fuel distribution, to me, is from people who have enjoyed a rent economy for a very long time. If an economy moves from a rent status to a fully market system status, those that enjoyed the rent economy status will automatically become casualties of the change because competition will become the name of the game.

“The Tank Farms owners, Depot owners and petroleum tanker drivers associations should just find a way to come together to agree within the industry on the way forward so that the system can be as accommodating as much as possible. We cannot subject the narrow commercial interest of a few over public interest. What the public wants is a more efficient system that delivers at lower price.” (Nigerian Tribune)