Since it was established by Decree No. 9 of 1975 (as amended by Decree No. 32 of 1989) the Petroleum Equalisation Fund Management Board (PEFMB) has lived up to its billing and even if recent, surpassed expectations.
There is one person to thank or credit for the high performance of the PEFMB, and that is the present Executive Secretary Ahmed Bobboi who came onboard in 2016.
On establishment, the board was charged with the primary responsibility of reimbursing petroleum marketing companies for any losses suffered by them, solely and exclusive, as a result of sale of petroleum products at uniform prices throughout the nation.
In view of that, the Petroleum Equalisation Fund Management Board (PEFMB) has advanced progressively in pursuing and implementing programmes that align with the focus of the Oil and Gas industry, a development that has been further consolidated on since present Executive Secretary, Ahmed Bobboi came on board.
Keying into the legislative Charter of the Board as provided by Decree No9 of 1975 as amended by Decree No. 32 of 1989 (now Chapter 352 of the Laws of the federation 1990), it is also expected to ensure that the Uniform Pricing Mechanism works effectively throughout the country.
To apply the laws of the Federal Republic of Nigeria as they affect the Uniform Pricing System, vis-a-vis degree No. 9 of 1975 (as amended by Decree No. 32 of 1989), establishing the Fund and the Board, in ensuring that each existing marketing company complies with the laws regarding the management of the transportation equalisation process, the board has evolved pragmatic approaches that have ensured stability throughout the country.
Such strategies include equalising the transportation differentials.
The areas that pertain to the downstream sector include the passage of the Petroleum Industry Governance Bill (PIGB) and the deepening of domestic gas utilization & consumption and overall monetization of the gas resource.
Achievements of the board led by its present Executive Secretary, Ahmed Bobboi so far.
- Improved Collection and Remittance of Outstanding Bridging and Other Allowances: uninterrupted payment of Marketers Claims to ensure efficient distribution and availability of petroleum products, and support of Marketers’ business operations.
PEFMB operations have remained uninterrupted during the ongoing COVID-19 pandemic, with sustained payments to Marketers’ to ensure the availability of petroleum products nationwide, price stability and support micro-economic activities.
- In alignment with the HMoS’s initiative for deepening gas penetration, domestication, utilisation and consumption, PEFMB proactively commenced evaluation of the provision of administrative support for infrastructural development in the downstream sector.
The organisation is also exploring and establishing programmes that will support the FG’s drive for job creation, establishment of small and medium scale businesses.The PEFMB is also a member of the National Gas Expansion Programme Committee.
- The Federal Executive Council (FEC) approval for implementation of the Downstream Automated Fuel Management System (DAFMIS) is ongoing. DAFMIS is a solution that will enhance delivery, monitoring and management of the downstream petroleum products, serve as a data repository and credible source of information for national planning and economic development.
In partnership with the Nigeria Customs Service and identified Stakeholders, the DAFMIS technology has been successfully tested and was able to track live position of petroleum products from a Lagos loading depot to a retail outlet in Daura, Katsina state. Despite the pandemic and associated delays, the various workstream have continued to function, albeit virtually.
- In support of the FG and in response to the COVID-19 pandemic, the PEFMB presented palliatives to the Federal Ministry of Humanitarian Affairs, Disaster Management and Social Development to provide succor to the less vulnerable in the society. Donations were also made to the First Lady, Hajia Aisha Buhari’s Future Assured initiative, for distribution to the less privileged.
- The PEFMB has commenced the exploration of the provision of railway, and riverine & mountainous equalisation.
- Recognition of the PEFMB as Fund Managers by the National Council for Hydrocarbon.
- Capacity Building: With the aim of instituting a world class service delivery organisation and the grooming of a crop of highly skilled, competent, committed and disciplined leadership, PEFMB has made considerable investment in the development of staff with highly tailored, good quality training opportunities.
This is also in alignment with the Petroleum Industry Governance Bill (PIGB), in preparation for future responsibilities.
The organisation also promotes and encourages self development through the provision of an online training platform.
PEFMB aims to consolidate as well as seek new and better ways of creating value and claiming values with a vision of covering the field, from white products to stimulating economic activities in the Downstream Hydrocarbon sector in a sustainable way.
The legislative Charter of the Board as provided by Decree No9 of 1975 as amended by Decree No. 32 of 1989 (now Chapter 352 of the Laws of the federation 1990) are:-
To ensure that the Uniform Pricing Mechanism works effectively throughout the country. To apply the laws of the Federal Republic of Nigeria as they affect the Uniform Pricing System, vis-a-vis degree No. 9 of 1975 (as amended by Decree No. 32 of 1989), establishing the Fund and the Board, in ensuring that each existing marketing company complies with the laws regarding the management of the transportation equalisation process.
A flash back into why the board was established would make one recall that available records show that between 1974 and 1975, most petrol service stations nationwide were characterized by long queues due to frequent severe shortages of petroleum products.
The problem was compounded by the haphazard way marketers priced the product on the basis of transportation cost incurred by them.
In an effort to solve the problem, the Federal Government set up an inter-ministerial committee comprising of the then Ministries of Mines and Power, and Transport, the Nigerian Ports Authority, the Nigerian Railway Corporation and the Petroleum Products’ Marketers to examine the situation and make appropriate recommendations.
The committee observed that the only variable element in the provision and the sale of petroleum products at uniform price nationwide was the transportation cost.
It therefore, blamed the limited local refining capacity and inadequate distribution facilities for the problem. In line with the recommendation of the committee, Government introduced the Uniform Pricing System.
In cognizance of the inequality in the transportation cost of distributing products throughout the country, the Petroleum Equalization Fund (Management) Board was established.
So far, Nigerians are better off for it as the pump price in Bayelsa and Borno and all over the country remain the same.