Aviation fuel: Pipeline idle for 30 years could ease scarcity

The pipeline meant to transport aviation fuel to the Lagos local airport but which has been sitting idle for 30 years should be repaired to ease fuel supply to airlines, industry stakeholders have said.

They said if the pipeline was functional, the trucking of aviation fuel to the airport would be avoided, thereby reducing the overall costs being incurred by airlines.

BusinessDay checks also show that airlines operating in Nigeria pay a lot of money for aviation fuel as a result of the cost of demurrage and other logistics to fuel tankers.

The airlines have in recent weeks been struggling to carry out seamless flight operations as a result of aviation fuel scarcity and the high cost of the product.

The price of aviation fuel, also known as Jet A-1, which cost about N230 to N250 per litre last year, has risen to above N600 across all airports in the country.

On top of the continued rise in the price of the fuel, supply has been unreliable at several airports, triggering a rash of flight delays and cancellations in recent days.

John Ojikutu, aviation security consultant and Secretary-General of the Aviation Safety Round Table Initiative, wondered why the pipeline designed to transport fuel from Ejigbo to the MMA could have been repaired by the Nigerian National Petroleum Company Limited since 1992, after it was ruptured.

“It would have cost about $9.2m then to replace the ruptured pipes but sadly, nothing was done or had been seriously considered to be done. Rather, tankers have been bridging the supply from the NNPC depots, with the cost of transportation and demurrage added, and having to for days and sometimes weeks to discharge at the airport depots.”

BusinessDay gathered that aviation fuel accounts for 30 per cent of the airlines’ operational cost.

According to operators, if the product was directly supplied through the pipeline, it would become cheaper and available, and this will help them reduce their costs and plan ahead in their operations.

Olumide Ohunayo, an aviation analyst, told BusinessDay that it was sad that Nigeria had left the pipeline damaged for 30 years.

Ohunayo noted that the pipeline was constructed to transport fuel from the depot to the airport every day because those who built it understood the reasons, the costs and the efficiency of the pipeline to the airport system.

“When aviation fuel is trucked, the cost of transportation doubles. The NNPC should work on returning the pipeline back to the airport for safe and efficient distribution of aviation fuel. The cost of demurrages, transportation, security, safety, traffic, road networks are all costs incurred by marketers which they transfer to the airlines,” he added.