- The Nigerian National Petroleum Corporation (NNPC) has stated that it will scrap over 500 retail outlets due to inherent fraud along its value chain.
- The Group Managing Director (GMD) of NNPC, Dr. Ibe Kachikwu, stated this in Lagos State at the weekend while addressing journalists on his agenda for the corporation.
According to him, “we started our retail business with about 23 filling stations of our own. But right now, we have affiliates of about 500 filling stations.
How do you grow from 20 to 500 in two years without institutional supports? What has happened is that there is a lot of fraud inherent in that cycle and lots of products disappear along the value chain. So we will revoke the retail licenses to our affiliates and focus on our retail outlets.”
- He also said that “until a scenario came in, the amount of money that was being put into the retail business was affected and nobody was collecting it.
“In a private venture, when I was running my own oil company, you pay ahead of time, that is, you pay before you get allocation. So the issue of money disappearing does not even arise.”
- When asked to be specific on the amount of fraud, he only asserted that “most of the independent marketers pay for their products on time but the major marketers are not (paying on time). So again, we are going to cut down the credit cycle because it is being abused. If I want to give you products, you must pay.”
- He said apart from reducing the retail outlets, he said the corporation would cut down credit line in order to improve the efficiency of collection process.
“There are lots of nostalgia you have to unleash in the system and we are getting there,” he said.