An ad hoc committee of the House of Representatives on Monday summoned the Governor of the Central Bank of Nigeria, Mr. Godwin Emefiele, to explain how International Oil Companies got involved in the sale of foreign exchange to importers and marketers of petroleum products in 2016.
The committee, which is chaired by a member from Imo State, Mr. Nnanna Igbokwe, is conducting a public hearing on the review of the pump price of Premium Motor Spirit from N145 to N70.04.
The House had on November 29, 2016 passed a resolution asking the Petroleum Products Pricing Regulatory Agency to review the pump price of PMS, otherwise known as petrol, to N70.04 per litre, because some charges in the current template were not justifiable.
It also ordered a public hearing on the matter to guage the views of major stakeholders with a view to reviewing the pump price.
The IOCs reportedly sold over $1bn worth of forex to the fuel importers.
The committee also uncovered that at a point last year, even the CBN was buying forex from the IOCs.
Lawmakers said Emefiele must tell Nigerians how the IOCs assumed the role of financial houses in the country.
Members expressed shock when they also learnt that in some months last year, the apex bank exceeded its monthly sale of forex by five times and resorted to buying from the IOCs.
The Director, Financial Markets Department, CBN, Mr. Alvan Ikoku, defended the apex bank before the committee, claiming that there was nothing new in the IOCs selling hard currencies to both the CBN and importers.
Incidentally, most marketers had complained to the committee that they were unable to import products because they could not access forex.
Igbokwe stated, “Marketers and importers of PMS, in particular, reported that they had difficulties in accessing foreign exchange to be able to import the products.
“That was why we invited the CBN to come here in the first place, but it will be interesting to hear from the governor the role of the IOCs in all of this.
“What CBN laws and financial regulations allow IOCs to trade foreign exchange to importers and dealers?”
Rather than cite the laws, Ikoku replied that the bank’s legal department would provide the answer.
However, members resolved that Emefiele would be in the best position to clarify the issue.
The committee immediately summoned him to appear at the next adjourned date.
Igbokwe added, “The invitation of the CBN to the committee’s hearing is occasioned by the fact that most of the importers and marketers of petroleum products, in this case as it relates to PMS, had alluded to the claim that they had difficulties in accessing foreign exchange to be able to import the products.
“They complained that for now, the CBN is doing a systematic allocation of forex, which is making forex really very difficult to access to them.
“And here at the presentation, the CBN came to explain that; and with the record they presented, which we felt was not enough, it did not show enough documents for us to be able to make reasonable deductions and conclusions.”
He added, “Because of that, we asked them to show us the record of allocation of forex to importers and petroleum marketers from January 2015 to date.
“We could see that in 2016, they said there was an arrangement between the Nigerian National Petroleum Corporation and the IOCs to sell dollars to importers, dealers and marketers, which started around July.”
Meanwhile, the Nigerian Navy told the committee that insecurity could not have been a major reason for the high cost of petrol in the country.
It said its personnel monitoring the harbour in Lagos had not reported any attacks on vessels.
The Director of Marine Services, Nigerian Navy, Commodore A. A. Efedue, stated, “I have interacted with marketers; what I have been told is that security is not the issue, but the numerous charges they are subjected to by the agencies.
“If security is the issue, why are the vessels, including those with products at the Lagos harbour, not attacked? Why are the oil importers the only ones talking about insecurity?”