Tag Archives: Aviation Fuel

NNPC supplies 38.7 million litres of aviation fuel in 6 days to curb scarcity.

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The Nigerian National Petroleum Corporation (NNPC) yesterday said it had injected another 28.2 million litres of aviation fuel into the market to curb the current scarcity.

It was learnt that the fresh supply brought the total number of aviation fuel influx into the market, from NNPC alone, to 38.7million litres in the last six days.

But the influx has not assuaged the crippling fuel shortage at airports nationwide, as most passengers, till yesterday afternoon, were still stranded at major terminals.

NNPC’s Group Managing Director, Dr. Maikanti Baru, said in the build-up to the Yuletide period, the corporation had exceeded the demand of marketers, noting that it had imported about 38.7 million litres, representing about 26-day sufficiency.

He explained that on December 14 this year, the corporation completed the discharge of 8,800MT, which represented about 10.6 million litres to major terminals in the country. In addition, as at yesterday, 23,500MT representing about 28.2 million litres, were being discharged to the major oil terminals.

In order to sustain the tempo, the NNPC has also secured the supply of additional 30,000MT vessel of ATK (36 million litres) expected to berth Nigerian shores before the end of the year.

The NNPC said it had over 40-day sufficiency for Premium Motor Spirit (petrol), PMS and adequate volumes of Automated Gas Oil (Diesel) AGO and DPK to satisfy national demands throughout the yuletide period and beyond.

Executive Secretary of Major Oil Marketers Association of Nigeria (MOMAN), Obafemi Olawole, recently assured that the marketers had enough supplies till the end of the year, until scarcity erupted from the operators’ end.

Air Passengers Stranded As Aviation Fuel Scarcity Bites Harder Nationwide

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Air passengers in Nigeria are stranded at airports nationwide, as airline operators jostle for aviation fuel, amidst scarcity that is getting worse.

On Tuesday, the passengers, some of whom were on transit, waited endlessly for the departure hall. While few were lucky to later travel, others were later informed that their scheduled flights had been cancelled.

Aviation fuel, otherwise called Jet-A1, is a specialised type of petroleum-based fuel used to power aircraft and normally accounts for over 30 per cent of operation cost of an airline.

Jet-A1 is 100 per cent imported into Nigeria and subject to fluctuations in the foreign exchange market. In the last 12 months in Nigeria, aviation fuel has steadily climbed from N104 to N240 per litre in Lagos and as high as N270 in northern part of the country.

Flight delays and outright cancellations means that air travelers are unable to meet scheduled appointments at their respective destinations. In extreme cases, this may also result to huge loss of revenues for those hoping to seal some business deals.

At the General Aviation Terminal (GAT) of Murtala Muhammed Airport (MMA), Lagos, for instance, about three out of every four flights were cancelled, with operators citing “operational reasons”.

The Guardian learnt that one of the airlines operating at the GAT, in fact, cancelled all flights on Monday, and left passengers to learn of the development on getting to the airport.

At the Murtala Muhammed Airport II (MMA2) Terminal, also in Lagos, airlines like First Nation, Med-View, Azman and Dana Air were carrying out services but behind schedule.

Read More:

http://guardian.ng/business-services/air-passengers-stranded-as-aviation-fuel-scarcity-bites-harder-nationwide/

Reps summon CBN, NNPC over forex, aviation fuel.

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The House of Representatives Committee on Aviation has directed the Central Bank of Nigeria (CBN) and the Nigerian National Petroleum Corporation (NNPC) to appear before it today to explain its role in the challenges facing the aviation sector.

Meanwhile, a leading financial institution, Access Bank Plc, has successfully raised $300 million via a Eurobond from the international bond market.

The aviation sector is currently battling challenges associated with operations of foreign and local airlines in Nigeria.

According to the Chairman of the House committee, Nkeiruka Onyejeocha, who handed down the summons yesterday at the ongoing public hearing on the need to rescue the airline industry from collapse, the apex bank is to specifically explain the foreign exchange instability that is affecting the finances of airlines.

NNPC on its part, according to Onyejeocha, is to explain the lingering scarcity of aviation fuel, especially as some airlines-local and international- are cutting down on their operations.

Already Arik Air, Dana Air and Medview are incessantly cancelling and delaying flights due to the shortage of the product, also known as Jet A1. Emirates Airlines on Tuesday announced the suspension of its Abuja-Dubai operations due to challenges in foreign exchange, low patronage and other operational difficulties.

The committee was however dissatisfied with the assurances of CBN, through its Assistant Director, Infrastructure Finance, Mr. Boma Benebo, who was at the investigative hearing.

Benebo had assured that the apex bank was effecting downward reviews of operational expenses of airlines, such as landing and parking fees and passenger service charges.

The President and Chairman of Council, CIBN, Prof. Segun Ajibola, at the 16th national seminar on Banking and Allied Matters for Judges, in Abuja, lamented that while there are existing laws to deal with these issues, they have continued to rear their ugly heads.

Meanwhile, a leading financial institution, Access Bank Plc has successfully raised $300 million via a Eurobond from the international bond market.

The bank recently assessed the international market to raise the bond with maturity date in October 2021, at a coupon of 10.5 per cent.

This makes Access Bank the first Nigerian bank to raise bond from the international market this year despite the country’s macro-economic headwinds. The successful outcome of the bond also demonstrates the strength, resilience and international endorsement of Access Bank Plc.

Industry analysts perceived the development as a show of support for the Federal Government’s efforts to attract foreign exchange into the country.

The bank currently has two series of Eurobonds in issue – the $350 million maturing in July2017 at a coupon of 7.25% and the $400 million (9.25%), June 2021 maturity date as part of a $1 billion global medium term note programme.

Commenting on the development, Herbert Wigwe, Group Managing Director/CEO of Access Bank, said, “the bond will be for working capital, for lending to investment-grade names, including Nigerian companies seeking to expand their exports.”

He emphasised that the process signifies a significant moment on the bank’s journey to entrench itself as one of Nigeria’s top three banks by 2017.

“It also ensures that we keep our promise of speed, service and security to our customers as we target Africa’s fastest-growing industrial sectors,” he added.

Marketers Accused Of Raking In Profits Selling Aviation Fuel As Kerosene

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As the price of kerosene continues to soar because of inadequate supply, marketers have been accused of selling Jet A1, better known as aviation fuel, as kerosene, in the process making a kill of N50-N100 per litre.
The diversion of the product to fuel outlets where it is sold as household kerosene has also been blamed for the scarcity of Jet A1 and several flight cancellations and delays in the aviation sector in the last one month, according to reports..
Kerosene and jet fuel are nearly identical in every way except for a few additives in modern jet fuel, with industry experts describing the latter as nothing other than cleaner kerosene with no sulphur content.
However, the scarcity of foreign exchange in the country has made it very difficult for oil marketers to import and supply petroleum products that would sufficiently meet the needs of consumers.
As such, several marketers have started diverting Jet A1 to fuel outlets where it is sold as kerosene at a higher price than aviation fuel.
Aviation fuel sells for between N198 and N200 in Lagos while kerosene goes for N200 to N300 per litre.
Investigations revealed that marketers now prefer to sell Jet A1 as kerosene after degrading it and that explains the scarcity of aviation fuel in the past one month, leading to flight cancellations and delays.
Informed sources confirmed that aviation fuel is highly refined kerosene with zero sulphur, which when used for cooking leaves the pot without soot.
But instead of importing kerosene, oil marketers import aviation fuel because almost all modern refineries in the world no longer refine kerosene owing to the low demand for the product as a heating oil in several countries.
However, Nigeria’s refineries, which were built between the 1960s and 1980s still produce kerosene and unlike refining plants in other parts of the world, the Nigerian plants have not been upgraded to refine only diesel, petrol and Jet A1.
A seasoned aeronautical engineer and pilot, who operates a non-scheduled flight out of Lagos, said at the weekend that the current scarcity of aviation fuel would persist until marketers and the Nigerian National Petroleum Corporation (NNPC) begin to import sufficient kerosene to meet consumers’ demands.
The source said that every jet engine can use kerosene, but Jet A1 is of higher quality because it has no sulphur.
Credit: Thisday

Five Oil Marketers Banned From Supplying Aviation Fuel

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The Nigerian Civil Aviation Authority (NCAA) has directed five oil marketing companies to stop supplying aviation fuel to local and foreign airlines operating in the country.

In a notice to the Airline Operators of Nigeria (AON), the NCAA explained that the suspension became necessary due to lack of depot facilities by the oil firms and the inability to verify their integrity and competencies.

The five firms listed in the NCAA circular are; Ascon Oil, Acorn Petroleum, Jushad Oil and Gas, Lubcon and Star Orient Aviation.

The regulatory body has directed the Federal Airports Authority of Nigeria (FAAN) to deny the companies access to airports in the country until further notice, demanding strict compliance with the directive.

Credit: ChannelsTV