Nigeria Content Online

The Federal
Government is considering a new biofuels development policy for a
viable alternative to the continued dependence on imported petroleum
products as fuels for energy supplies in the country.

A forum recently
facilitated by the Petroleum Products Pricing Regulatory Agency (PPPRA)
has already recommended the constitution of a technical committee to
undertake a comprehensive review of the 2007 national biofuels policy,
to remove all impediments to achieving the bio-fuels development
initiative, and replace with a framework that will be more commercially
friendly.

The Energy
Commission of Nigeria (ECN) is expected to provide the necessary
technical input to the deliberations, particularly concerning previous
and ongoing biofuels initiatives, as well as the existing relationship
between producers and foreign off-take partners from China and
Singapore. This will also enable Nigeria gain access to the carbon
credit available under the Clean Development Mechanism (CDM).

During a recent
meeting in Abuja, attended by the Department of Petroleum Resources
(DPR) and other government monitoring and regulatory agencies in the
oil and gas industry, members observed that the provisions of the
existing policy document were inadequate to help realise the national
objective.

Participants were
of the opinion that rather than have an agreement entered into solely
with the Nigerian National Petroleum Corporation (NNPC), as envisaged
under a previous arrangement, the proposed policy should make it an
industry-wide pact, to enable depot owners and petroleum products
marketers partake, in line with the current reforms in the petroleum
industry.

Unhelpful policies for local production

They also pointed
out that the current import-based policy on petroleum products supply
in existence was a dis-incentive to local production and domestic self
sufficiency in fuels production.

The Biofuels Policy
and Incentives (2007), which was approved by the Federal Executive
Council on June 20, 2007, and gazetted to facilitate the promotion of a
national bio-fuels development programme in the country, was, however,
found to contain some lapses, including its being dependent on import
as well as state-controlled monopoly.

The NNPC was
mandated to create an enabling environment for the take-off of a
domestic ethanol fuel industry, to gradually reduce the country’s
dependence on imported petroleum products, reduce the negative impact
of environmental pollution, as well as create a commercially viable
industry capable of sustaining the creation of domestic job
opportunities.

“The imperative for
a policy review is that given the fact that bio-fuels markets worldwide
are mandate-driven, Nigeria cannot afford to be an exemption. There
need for the biofuels policy document to be reviewed by a sub-committee
before presentation to the main committee. There is also the need to
incorporate other relevant organisations, such as the financial
institutions, farmers association, etc.,” said Abiodun Ibikunle, the
PPPRA executive secretary.

The technical
committee on biofuels development, which is expected to be inaugurated
next week by the minister of petroleum resources, Diezani
Alison-Madueke, will include the NNPC, Major Oil Marketers Association
of Nigeria (MOMAN), Depot and Petroleum Products Marketers Association
(DAPPMA), DPR, PPPRA, and Standard Organisation of Nigeria (SON).

Others are
representatives of the ECN, Central Bank of Nigeria (CBN), New
Partnership for Africa’s Development (NEPAD), National Association of
Road Transport Owners (NARTO), farmers association, federal ministries
of finance and petroleum resources.