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By Chinelo Obogo
Airline Operators of Nigeria (AON) has raised the alarm over the increasing cost of aviation fuel, saying the price of the product has peaked to N714 per litre in some airports and that at least three domestic airlines may shut down in the coming months due to this.
Speaking at the maiden edition Federal Airports Authority of Nigeria (FAAN) National Aviation Conference (FNAC) with the theme: ‘Advancing the Frontiers of Possibilities for Safe, Secure and Profitable Air Transport’, in Abuja on Wednesday, Mr. Allen Onyema, the Vice Chairman of AON, warned that if the present challenge of aviation fuel was not nipped in the bud, more airlines may shutdown operations in the coming months.
The AON Vice Chairman who refused to name the airlines said that the aviation fuel challenge is not limited to Nigeria alone, but emphasised that ours is made worse because of the slump of naira against major currencies, especially the dollars.
According to AON, in order to address the challenge, the Federal Government approved 10,000 metric tonnes of aviation fuel to the airlines, but said the carriers were yet to access it.
Onyema explained that the airlines hoped to start lifting the 10,000 metric tonnes of aviation fuel from Thursday.
”That is why we ran to the government and the Federal Government has given us about 10,000 metric tonnes of fuel at the cost of N580 per litre in Lagos and about N607 per litre outside Lagos.
”This is not the only issue. Since the COVID-19 crisis, most airlines all over the world, including Nigeria have not recovered except those whose countries have injected so much funds to assist them. This is no body’s fault. It just happened. Government has tried it’s best by giving us this aviation fuel. This aviation fuel can take airlines out, not only in Nigeria but everywhere in the world.
”Some airlines outside Nigeria have closed down because of the effects of rising aviation fuel. If these things are not addressed in Nigeria, it can affect the bottom line of all airlines in Nigeria.
”We have come to realise that there is little or nothing the committee set up can do because this is as a result of foreign exchange and price of oil all over the world now. The fuel marketers will sell according to what they are paying. The cost of aviation fuel has increased, even in London and every other country. Our own is worse because of the increase in foreign exchange,” he said.
A representative of aviation fuel marketers, John Abegunde, while speaking, appealed to the government not to step into the commercial related issues in aviation fuel supply, warning that this major jeopardise safety in the system.
Abegunde explained that FAAN, NCAA and other government agencies should rather be more concerned about the stringency of the aviation fueling requirement.
He added that the fuel marketers subscribed to joint ownership of aviation companies, but kicked against the throughput arrangement, which he said may work against the industry growth in the future.
“We should be wary of portfolio investors who come in when there are opportunities in the sub-sector, but moves out with their briefcases immediately there is a challenges,” he said.
Other players like ground handling companies and catering services in their separate presentations, complained about the state of infrastructure at some of the airports, but said FAAN in the last three years had done a lot to improve the facilities at the aerodromes.
Mr. Bashir Ahmed, the Vice Chairman, Aviation Ground Handling Association of Nigeria (AGHAN), decried the level of infrastructure at most of the airports, saying that it limited the turnaround time of operators at the apron.
According to Ahmed, the scarcity of foreign exchange further reduces the operations and expansion of ground handling businesses in Nigeria.
He appealed to the Federal Government to take a critical look at the challenges in the industry and device a mean to addressing them.
