According to Aganga, supply at the Zaria Laboratory would be handled by AVS Nigeria/Artec Technology, Netherlands at a cost of 1.2 million. Aganga said the supply, installation and training for a vehicle evaluation laboratory in Zaria will be handled by Mustang Advanced Engineering USA/Afram Nigeria Ltd. for 900,000.

Mixed Reactions

Emmanuel Ekpenyong, head of lubricants for Honeywell Oil and Gas Ltd. lauded the action as a welcome development for local blenders. It will make Nigerian lubes acceptable anywhere in the world because these laboratories will be able to test for all the … parameters that define or characterize any automotive lubricant, including engine oils, gear oils, transmission fluids and greases produced or consumed in Nigeria, he said.

With the establishment of these laboratories, original equipment manufacturers and vehicle component manufacturers that are setting up or operating plants in Nigeria will be able to produce vehicles and components that will be tested in line with international standards, Ekpenyong added. This will help ensure that Nigerian-made vehicles and components meet international standards and can compete favorably with automobiles/components from other plants the world over.

Olaniyi Okedairo, head of Velvet Hill consultancy, agreed: The establishment of auto-testing centers is long overdue for a country that prides itself on being the largest economy in Africa. The development is very exciting for local blenders [and will help] improve their market share because the importation of substandard lubes would decline.

Taiye Williams, managing director of Lubcon International Ltd., is excited about the development, considering that at the First Nigerian Lubricant Summit he made the case for a standardized lab for the lubricant sector in the country. We learned the contract to install these labs was awarded to AVL List GmbH. This companys skill is widely known for a revolutionary test bed that allows for comprehensive data acquisition and analysis. They are strong in powertrain simulation and testing technology – including hybrid, combustion engines, transmission, electric drive, batteries and software – for passenger cars, trucks and large engines.

John Erinne, chief executive of Matrix-Petrochem, does not share in the excitement; rather, he argues that most local blenders will maintain a posture of guarded optimism. On paper, it is a positive development. In reality, however, it depends on how seriously the government takes the projects and how well they are run on completion, he said.

Emeka Obidike, executive secretary of Lubricant Producers Association of Nigeria (Lupan) said, As much as we appreciate the approval for auto testing centers, there is not as much excitement as there would have been had the government decided to approve the establishment of a standardized lubricant testing center. Nevertheless, we have not given up hope of its being established.

Obidike added, I believe what the stakeholders had in mind was something wholly committed to testing of base oil and finished lubricants, both local and imported. These centers are not to be shared with any other sector or subsector of the petroleum industry or its affiliates. Ekpenyong agreed that lubricants as a consumable automobile component should have a separate lubricants division or department at the Enugu plant, which is earmarked for component testing.

Williams, however, cautioned that local blenders will only have one concern: Mandatory testing if considered will be an additional cost, but it will be worth it if local products that meet the standard will be considered for factory fill of autos assembled in Nigeria. Tariffs on imported lubes should be raised as requested to enable our plant
to thrive and, thereby, empower us
to compete favorably and set reasonable lubricant standards for the country.

Gains from First Lubes Summit

Local blenders said their proposal for the government to establish a laboratory to enhance the development of lubricants to meet OEM demands provided the impetus for the new auto testing centers. At the first Nigerian Lubricant Summit in Lagos, Williams had proposed a unified body to test base oils coming into the country as well as finished lubes.

I offered a suggestion that the government set up a lube testing lab, Williams said. If these labs can fit this need we are the better for it. Both Okedairo and Ekpenyong concurred that the establishment of auto-testing centers, especially the components testing center in Enugu, meets the demand of stakeholders for a national standardized laboratory.

While local blenders see the new testing centers as a positive development for the sector, they nonetheless are unsure about what areas of testing will be covered. The labs will meet the needs of the lubricant sector if they include at least a level of engine testing, which of course will include lubricant performance, Williams said. Obidike added, The concept of an auto testing center will not entirely meet the demands of the subsector as much as a standardized lubricant testing center would.

Substandard Lubes Stopped?

One of the biggest challenges facing the Nigerian lubricant market is the proliferation of substandard lubes and product counterfeiting. Despite measures employed by regulating agencies such as the Standard Organization of Nigeria (SON) and Department of Petroleum Resources (DPR), not much has been achieved in this regard. Therefore, stakeholders anticipate that the approval of the auto testing labs may be the elixir to stem the tide of counterfeit and substandard lubricants in the country.

Ekpenyong feels that the new centers will help reduce the proliferation of substandard lubes because the regulatory agencies and standards body will have a government owned one-stop laboratory where both locally produced and imported lubricants can be subjected to in-depth quality tests to ensure compliance with international and Nigerian standards.

This is imperative because lube testing equipment is not cheap and most lube blenders in Nigeria can afford to procure only the very basic testing equipment. In most cases, this equipment cannot run the needed comprehensive tests on lubricants, he added.

Okedairo concurred, saying, Definitely, the establishment of the centers would check the flow of substandard lubes in Nigeria, provided enforcement is strict and total. The centers would impact significantly on the quality of lubes in the market and would give rise to healthy competition based on quality rather than brands.

Erinne agreed that if deployed and positioned properly, the laboratories can assist in removing substandard and adulterated lubricants from the market, at least to some extent.

Williams noted that another step is needed before the government can effectively tackle substandard lubes in the market. We need a sort of mandatory certification of lubes via the approved testing laboratory. In that way, the wheat and the chaff will be separated, he stated.

Obidike added, A standardized lubricant testing center could sort out the problems of substandard base oils, thereby attacking the problem at its roots. And testing finished products, both domestic and imported, to ascertain their compliance with the approved specifications and standards would be a valuable deterrent.

Growing OEM Presence

In the aftermath of the enforcement of the National Auto Policy in Nigeria, many OEMs have either opened factories in the country or are preparing to establish one. At a recent meeting with vehicle manufacturers, dealers and customs agents in Abuja, Olusegun Aganga disclosed that 10 additional OEMs have finalized plans to set up shops in the country.

We are particularly encouraged by the level of interest and enthusiasm being shown toward the new automotive policy by Nigerians and original equipment manufacturers, said Aganga. If anyone had told us that about 22 OEMs would sign onto the new auto policy in less than one year after its implementation, we might not have believed it. Currently, we have about four companies assembling vehicles in Nigeria. We are expecting another ten to start assembling cars in the country before the end of the year, he added.

Stakeholders emphasized that the increasing presence of OEMs in Nigeria will also favorably impact the quality of lubricants in the country. Thats why most applaud the new auto testing centers as a step in the right direction by the government.