By: Laymah Kollie
Plenary of the Liberian Senate recently took a decision to reprice Petroleum services for Private and Public Tank owners. The decision affects storage charges for petroleum products, financing cost, and evaporation cost as well.
In the new prices, storage charge for both private and public tank owners amount to $0.10cent per gallon, $0.6cent for jetty maintenance, $0.9cent for independent inspectorate, $0.5cent for testing and handling, and $5cent for road fund, totaling $0.35cent.
Financing cost is set at $0.1cent and evaporation cost at $0.50cent which is a 50percent reduction rate.
The Plenary decision is performed through her oversight responsibility to ensure that services and actions are carry out in the interests of the ordinary Liberian. Sen. Moye said, instead of private tank owners getting the storage charge for their personal benefit, they will now be charging not more than $0.10cent for such service, While the $0.5cent in LPRC storage charge will be distributed to the fifteen counties equally for road connectivity.
Background
Senator Emmanuel J. Nuquay of Margibi County, on June 30, 2025, wrote to the Plenary of the Liberian Senate highlighting the unfair and troubling nature of the Petroleum Pricing Formula and requested an investigation into the matter so as to properly restructure the Petroleum Pricing formula to benefit the country.
The letter was read in the Senate Plenary on July 3, 2025 and referred to a Joint Committee comprising of Ways, Means and Finance, Judiciary, Public corporations. Commence, Trade and Industry and Hydrocarbon, to investigate and report to plenary.
According to Senator Nuquay, importers of petroleum products are charging per gallon a financing cost for the importation of petroleum products as follows; $0.046 for PMS; $ 0.052 for AGO; $0.011 for JET A1 and $0.09 for HFO. Sen. Nuquay further asserted that these importers have been in the business for years and as such they should bear their own financing cost and not the citizens.
For Evaporation, the Lawmaker said, the petroleum pricing formula contains evaporation charges of $0.03 for PMS; $0.02 for AGO; $0.03 for JET-A1 and $0.03 for HFO. Per gallon of petroleum product. Noting that these charges incorporated in the pricing structure are excessive and don’t reflect current day reality and best practice in the sector.
The Margibi Senator assertion, the current petroleum pricing formula contains a bulk storage charge of $0.35 per gallon. This charge was increased in May by $0.05, taking the storage charge to $0.35 per gallon of petroleum product.
Sen. Nuquay further stated that this bulk amount was initially charged by LPRC to cover all of it’s activities, including Regulatory./Administrative, Testing, Vessel Discharge, Jetty maintenance and Storage when it was the only entity storing petroleum products.
At current both LPRC and Private Storage Tank owners are charging the same amount. This situation is grossly unfair as private storage tank owners have benefited and are collecting regulatory and others charges for which they are not rendering services. Hence, the storage charge be revisited to remove regulatory and other charges from the bulk amount of $0.35 and that all charges imbedded in this amount be detailed on the Petroleum Pricing Formula.
In furtherance of Plenary’s mandate, the Joint Committee scheduled a public hearing on July 8, 2025 and invited the following institutions: LPRC, Ministry of Commence, Trade and Industry, Liberian Business Association, Petroleum Importers Association, and the Petroleum Storage Tanks Owners Association.
At the hearing, only LPRC and the Ministry of Commence attended. The other invitees did not attend neither did they send communications giving reason (s) for the absence.
The Committee Findings:
After a through engagements with both LPRC and Ministry of Commence, the Joint Committee derived the following.
That the Financing cost is still excessive and should be reduced, That Evaporation between 1 to 1.5 percent of landing cost of petroleum are excessive and should be reduced; That from January to June 12, 2025, the total importation of petroleum products is 89,528,399 in the following categories. PMS 37, 560,567; AGO 45,263,415; JET-A1 1,648,673; HFO 5,055,744;
The Committee findings also reported that by applying the current evaporation rates of 1.5% for PMS, and 1% for the other products, would suggest a total of 1,083,085 gallons evaporated in the following categories: PMS 563,408 gallons; AGO 452,634 gallons, JET A-1, 16,486 gallons, HFO 50,557 gallons;
According to the report, evaporation is monitored by LPRC employees and has never been Independently verified or audited; and there is a need for an independent verification of actual evaporation, petroleum quantity imported and quality of petroleum;
Other reviews were: LPRC’s storage charge covers for all of its services including storage. vessel discharge, through port, testing, regulatory and etc.; but private storage tank owners do not provide these services besides storage; and they (private tank owners) get the same amount of $0.35 per gallon of petroleum product for storage as LPRC.
The committee investigation also reveals that LPRC regulatory, testing, Jetty maintenance and Vessel discharge charges are not separately accounted for in the Petroleum Pricing Formula but are included in the storage charge; which should be separated from storage charge;
Furthermore , the storage charge of $0.35 is extremely excessive and is the highest in the sub region and possibly the World and that the Global Industry storage charge is less than US$0.05 per gallon, and that the current storage charge is a public fund and should be mostly directed to benefit the country.
Storage Charge in Neighboring Countries
The storage charge in Sierra Leone is US$4.70 per MT of PMS or US$0.013 per gallon and for Diesel US$4.70 per MT or US$0.015 per gallon, and in Nigeria is 2.58 naira per liter (US$ 0.0064) per gallon and
Presenting the joint Committee report in Session last Thursday, Senator Prince Moye of Bong County said when LPRC increases prices on storage charge and other services, the private owners also increase their prices without performing the same services, which is a burden to the ordinary Liberians.
“We have come to propose based on all the research and all the analysis made, and the best practice internationally that the storage charge per gallon in our country will now be 10 cent (in the tank). A 5cent of that 35 cent will go towards the road fund to increase the amount for the road fund and the 5 cent should be distributed evenly to the counties” Sen. Moye’s said.
He continues “the Jet maintenance will be at 6 cent , independent inspectorate 9 cent they will ensure that inspections are done to allow private tank owners to compile with this new structure and ensure that all of the different actions that will be recommending are considered.
Of course testing and handling will be at 5 cent so when you sum everything up store fees will now be charged for private tank owners 10 cents instead of 35 cent bulk figures. Totally 35 cent.”
Meanwhile, the report was hardly debated by Plenary and a decision was made to induce the committee’s report. The Senate decision will now be communicated to the Executive for onward action.
