The Nigerian National Petroleum Corporation Limited has revealed that petrol smugglers make around N17 million per truck selling petrol from Nigeria in neighbouring countries during the years subsidies were in place.
The Group Chief Executive Officer of the NNPCL, Mele Kyari, revealed this in Abuja when he addressed newsmen on the oil and gas sector.
According to Kyari, who spoke on the efforts to deregulate the sector on Monday, cross-border smuggling was rampant due to fuel subsidy, with a 6,000-litre truck giving the smugglers no less than N17 million per trip.
He said the same truckload would generate N500,000 if sold within Nigeria, especially in Borno State.
He said the country has stopped losing such revenue to smuggling since the stoppage of subsidies as fuel prices have now adjusted to reflect the true market value.
Kyari said: “In the last 47 years, PMS has always been subsidised.
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“And subsidy is creating arbitrage, which means there is a difference in price in one location, lower than what it should be in another location.
“And when Mr. President announced the subsidy in June, what he did was to recalibrate the price.
“There is no longer any value in anyone taking the product across the border.
“If you do, you’re not going to make more profits than you should do.
“In a 6,000-litre truck, you can actually gain up to N17 million from just one truck.
“How are you going to stop someone who, with two trips, can just easily make N17 million times two, which is the price of the truck itself?
“However, when you take a truck legally, maybe N8 million, say to Maiduguri, the legitimate value you have is less than N500,000.
“Why will I see N17 million and then take all the trouble to go to Maiduguri, keep it in the fuel station for one month, and then make N3 to N4 million?
“So you see, as long as you are not in a subsidy regime, you won’t lose money.”