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Question

Difficulty: EasyMining and Petroleum Sector: Roles, Impact, and Management

Before the full deregulation of Nigeria's downstream petroleum sector, which agency was statutorily responsible for reimbursing petroleum marketers for transportation costs to ensure uniform retail pump prices nationwide?

  1. Petroleum Equalisation Fund (PEF)Answer
  2. B
    Revenue Mobilisation Allocation and Fiscal Commission (RMAFC)
  3. C
    Central Bank of Nigeria (CBN)
  4. D
    Nigerian Export Promotion Council (NEPC)

Answer

Petroleum Equalisation Fund (PEF)
The correct answer is the Petroleum Equalisation Fund (PEF), which administered the bridging reimbursement scheme designed to absorb haulage cost variations so consumers paid uniform retail prices for petroleum products nationwide.

Step-by-Step Solution

1
Identify the primary function described in the question.
The target function is managing petroleum product transportation differentials to achieve uniform retail pricing across Nigeria.
Prior to deregulation, price disparities due to distance from coastal depots were mitigated through statutory transport equalization claims.
2
Match the function to the correct regulatory institution.
The Petroleum Equalisation Fund (PEF) was the government body dedicated to administer this bridging scheme.
PEF operated the bridging allowance mechanism funded by a surcharge on every litre of petroleum product sold.

Key Concept

Management and price stabilization mechanisms in the Nigerian petroleum sector
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Topics

Mining and Petroleum Sector: Roles, Impact, and Management

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