Blog

The alias for oil is black gold and due to the invention of internal combustion engine, oil has become a necessity for man. I won’t go onto details about how necessary oil is to Nigeria especially with the epileptic supply of electric power and bad road networks that causes unnecessary traffic jam. Oil has thus become a huge economic leverage for Nigeria on the international scale and also regarded as a “curse” by the decimated people of the South-South part of Nigeria. There is however a global demand for a green alternative to oil.

 

 

With all its strength and weakness, oil still remains a great investment deal both in the spot and the futures market. However, it requires huge capital to reap big time in any facet of this industry whether it is upstream or downstream sector. It is due to this that I am initiating a team that is interested in buying equity in one of the burgeoning oil haulage company. I took some time out last week to stay in their office to have a working understand of the business.

 

 

This is what I learnt about their business and it was quite revealing;

 

 

Oil is lifted from Lagos to Suleja, Abuja where they have partners who exclusively buy from them. 5 trucks of 33, 000 liters each of Premium Motor Spirit (PMS) – Petrol – are comprehensively insured and Goods in Transit insured to hedge transport risks. The cost breakdown is detailed in the table below;

 

 

 

Products will arrive Suleja, Abuja at an estimated Selling Price of N68.5 per liter presently

 

 

Profit Break Down

Oil is sold at N1 margin which brings price to N69.50

Profit (projected) per trip @ a conservative margin of N1 is = N165, 000. 00

A Target of two trips per week will give you = N330, 000. 00

In four weeks, we would earn = N1, 320, 000 .00

 

 

Extra Profit

Extra profit would be made through PEF as Federal Government takes charge of the transportation of petroleum products from South to the North. Presently, Government pays N270, 000.00 for one trip per truck directly to the account of the Petroleum Dealers.

 

 

I hope you are not too bored with the mathematics but I want you to see the potential monies that can be made through this Oil haulage business. Please, kindly know that the minimum investment per person is two million naira (N2, 000, 000. 00). This money criterion is very important in joining the team. Deadline is February 8th, 2009. If you are interested in knowing more and joining my team in investing in this obviously lucrative business, please contact me by clicking HERE

 

 

N/B: ALL PRICES USED WERE FROM LAST WEEK BEFORE PRICE FLUCTUATIONS: THE FUNDAMENTALS REMAIN THE SAME