ABSTRACT
This project is aimed at examining how petroleum products are marketed and the problems associated in doing so. The objectives of this work among others are to examine if petroleum products in Benin depot are adequately to be distributed to sales outlet, and if favourism and corruption affect the distribution of these products. To resolve these contention issues, data were collected through questionnaires and oral interview and these data were analyzed through chi-square. When the hypotheses formulated were tested and analyzed, it was observed that, petroleum products are inadequate for distribution at Benin depot NNPC controls the distribution of the product and there is too much favouritism and corruption in the distribution of the products. Based on the above findings, some recommendations made are that, government should invest more in the petroleum sector, private marketers should make contentious efforts to implement governments efforts, but to mention a few.
CHAPTER ONE
INTRODUCTION
1.1Background to the Study
Petroleum product marketing and distribution began in Nigeria at the turn of the country by simony vacuum oil company (the producer of moils) which marketed such flower kerosene product marketing has expands to the extent that seven major companies namely, AP, OANDO and a number of independent are now in the trade. NNPC was established in April 1st 1977 as a manager of the Nigerians National co-operation and federal ministry of and power NNPC by law manager the joint venture between the Nigeria federal government and another of foreign multinational co-operation, which includes vagal Dutch shell, Exxon Mobil, Agip total final ELF, chevron and Texaco (through the merge with chevrons) through collaboration with the Nigeria government conduct petroleum exploration and development. The lead of the Nigeria wing of transparency international say salaries for workers are too low to prevent graft.
As from September 2007, Nigeria president Umaru Musa Yar’adua plans to split the company into five (5) new companies. The NNPC tower in Abuja is the headquarter of NNPC. It is located on Herbert Macaulay way, central business district, Abuja NNPC also has zonal office in Lagos, Kaduna, Port-Harcourt and worried there is also an international office located in London, united state.
In May 2009, the NNPC identified that the Niger Delta unrest, and no impact on its business despite fight between government and bevels in this cil producing areas. Around 1975, the marketing product was entirely in private hand, owing to the quick recovery from civil war. The overall expansion of economic activities and unprecedented exploring in the demand for petroleum product in the 1970s the private companies were able cope with the domestic demand for product and the severe shortage that ensure all over the country constituted a major be title neck to further development. This promoted government to venture into petroleum product distribution and marketing.
Before 1965, all petroleum product consumed in Nigeria were improved. In that year, all most 25,000 barrel per day were produced, Port Harcourt refinery was built by federal government and British petroleum through 1962 government which created the Nigeria petroleum refinery company. The refinery initially met the domestic need for white petroleum product and exported some qualities of product to African countries and high pure fuel oil do the united state owing to the economic expansion in the 1970s.
The demand for premium gasoline and gas oil recovered on unprecedented manage annual growth rate of 30% between 1947 and 1977. To meet the domestic need interior arrangement were made from 1975 to refine Nigeria’s rude oil in curacaos and Rotterdam for importation of the product to Nigeria. As at 1978 about 175,000 barrels per day were involve. This off shore refining arrangement continued until two new refineries were commissioned in warn in 1978 and Kaduna in 1980 the two refineries have a combined processing capacity of 20,000 barrels per day. Recent forecast, however, indicate further increase in the domestic demand of petroleum product and the fourth National Development plan provides for the building of two more refineries. Petroleum product pricing was not informed through the country. The pump price depended on point of sales and this affected distribution and even development of the country. The oil marketing companies naturally concentrated their activities in area where cost of distribution was lowest and profit was high. Lagos and Port-Harcourt area were serves which the hinterland was not product adequately supplied encourage even distributed of product to all parts of the country.
Government introduced the uniform pricing system in October, 1943 for all grade of product and to differentials in the cost of product the decree 9 was promulgated, setting up the petroleum equalization find management board with the following function.
i. To retraining surplus revenue recorded from oil marketing companies.
ii. To reimburse companies for losses offered as a result of sales of product at uniform prices all over the country.
iii. To recover the differences between the landed costs imported product and the open market price in the country.
1.2Statement of Problem
It is on record that petroleum resources contribute about 70 percent of Nigeria across National product and about 80 percent of her export earning. Also petroleum resources have a lot it impact on national productivity. As a result, the distribution of the essential aspect of productive. Resources need to be efficient in not only in personal but also in terms of another aspect of logistics.
To this end, the study attempt to provide answers to the following question what is responsible for the scarcity of petroleum product at different time in the country that are the types of markets and distribution channels involved in the marketing the activities of channels members.
What are the motivating factors and to what extent can the factors be addressed in order to ensure staff to duty and higher productivity?
1.3Research Questions
The following research questions will be useful to understand the topic under study.
i. Is the volume of petroleum products at Benin depot always adequate for even distribution of sales outlets?
ii. Is the distribution of petroleum adequately controlled by NNPC?
iii. Are favouritism and corruption significant contributions to inefficient petroleum products distribution?
1.4Objective of the Study
The objectives of this study are;
i. To examine if the products in Benin depot are adequate to distribute to sales outlets.
ii. To examine if the distribution of petroleum products is adequately controlled by NNPC.
iii. To ascertain if favouritism and corruption contribute significantly to inadequate distribution of petroleum products.
1.5Research Hypotheses
Hypothesis I
HO: The volume of petroleum product at Benin depot is always inadequate for even distribution to sales outlets.
HI.: The volume of petroleum product at Benin depot is always adequate for even distribution to sales outlets.
Hypothesis II
HO: The distribution of petroleum is inadequately controlled by NNPC.
HI: The distribution of petroleum product is adequately controlled by NNPC.
Hypothesis III
HO: Toomuch favouritism and corruption are not significant contributors to inefficient distribution of products.
HI: Too much favouritism and corruption are significant contributors to ineffective distribution of products.
1.6 Significance of the Study
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