Reduce Cost of Aviation Fuel, Airline Operators Tell FG

Following the continuous drop in price of crude oil, airline owners have demanded that the federal government reduce the cost of aviation fuel across the nation.

Speaking under the aegis of Airline Operators’ of Nigeria, AON, the chairman of the forum, Nogie Meggison, told journalists in Lagos that operators in the aviation sector invest up to 40% of operational costs on fuel as against the globally accepted figure of 26%, according to figures recently released by International Air Transport Association, IATA.

IATA had predicted in December 2014 that the tumbling price of crude oil would lead to a fall in aviation fuel cost but so far, in Nigeria, the price of Jet A1 has remained stable at N170/litre while that of dual purpose kerosene, DPK, has risen to N150 per litre.

Meggison, who wondered why an oil producing country like Nigeria would have airline operators paying as much as the current price of N170 per litre for aviation fuel, said that the high cost of the Jet A1 was threatening the economic viability of the business for most stakeholders and forcing many to close shop.

He appealed to government to support indigenous airlines by reviewing the price of aviation fuel downwards.

“The current cost of aviation fuel is a big burden. A Boeing 737 aircraft consumes about 2,812 litres of fuel for a 50 minutes flight from Lagos to Abuja. When multiplied by N170 per litre, this will cost an airline with that aircraft type about N478,125 for that 50 minutes flight,” he said.

He suggested that a roundtable between the federal government and oil marketers would help find a middle ground to reduce aviation fuel costs.






     

     

    Meggison also criticized the 5% tax on tickets by the Nigerian Civil Aviation Authority, NCAA, and other high charges levied against operators by aviation agencies.

    Stating that the situation was making it difficult for many investors to venture into the sector, Meggison observed that the challenge in running an airline in the country is enormous because “multiple charges are paid to the Federal Airports Authority of Nigeria, FAAN, and the Nigerian Airspace Management Agency, NAMA.”

    Meggison lamented that Nigeria with over 170 million people barely has six operating airlines, many of them with few aircraft in their fleet.

    The AON chief, however, lauded the federal government for the waiver on customs duty for commercial planes and parts imports as he noted that the Nigerian Customs Service, NCS was cooperating to make the waiver work.

     

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