A report which shows more than £300 million was lost by fuel traders in Northern Ireland to the Republic is expected to be examined by the reformed Executive in the coming weeks.
The report by the Legitimate Oil Pressure Group found that 70 Border filling stations have been forced to close over the past year as motorists travel South to avail of savings brought about by lower excise duties and strong sterling. Smuggling is also believed to have increased in recent months.
According to the SDLP councillor and former mayor of Derry, Mr John Kerr, the report requires the urgent attention of the Executive.
"It is certainly a bit grim for the fuel dealers in the North. The situation has been brought about by market forces and the strength of sterling, and a lot of dealers have gone to the wall as a result," he said yesterday.
The Report on the Sale of Fuel in Northern Ireland, which has been circulated among Assembly members, shows that the volume of petrol sales has dropped by 40 per cent in the past six years. In the north-west, dealers along the Border with Derry and Donegal have been forced to close while in the Republic petrol-retailing businesses are thriving as never before.
One such is the Bridge End Service Station in Co Donegal, just minutes from the Derry Border. The owner, Mr Michael Doherty, built the station four years ago. "When we started out the punt was 8p stronger than sterling so you could say it has been a reversal of fortunes," he said.
The station is said to be one of the busiest in the State. On most days it is packed with Northern-registered cars with drivers attracted by signs which promise "25 per cent extra with your sterling". At one stage, said Mr Doherty, it was Texaco's busiest facility in Europe.
"It is just phenomenal," he said. "It is a freak situation. We have people coming from Belfast to fill up their tanks."
He said that some retailers on the other side of the Border were hurting very badly. "But you can't apologise for being successful and I have been on the other side of the fence, too," he said.
Those stations in the North which have managed to stay in business have done so by diversifying. Mr David Barber of the White Horse Retail Group on the Buncrana Road close to Bridge End has stopped selling petrol but now has a shop, a bureau de change, a car-wash and a car sales business.
"I was lucky that I had a premises that was big enough to allow me to diversify. Others weren't so lucky," he said.
He said smuggling was on a large scale. "In the early days I was approached by a couple of people but I would rather not sell petrol at all than do that," he said.
Mr Barber buys his own petrol at Bridge End Service Station. "I don't feel bad about the situation. It is out of my control. I can't dictate the excise duties or the sterling rates," he said. He believes that an exception could have been made for Northern Ireland with regard to excise duties.
"We are a cross-Border country, the only one in the UK. The government could have made a special case for us," he said.
Mr Thomas Palmer, chairman of the Northern Ireland Petrol Retailers' Association, said that if there were lower excise duties, dealers in the North would be able to compete much more effectively. "If they were lowered the problem would never have been as bad as it is," he said.
Mr Kerr said that while sterling appeared to be moving towards parity in recent days, there would always be a differential until Britain joined the euro, so it was vital that something was done.
Remarking on the increase in the problem of cross-Border smuggling, he said that the problem had always been there, but in recent times the scale and sophistication of the activity had increased. He said he hoped the Executive would "start bending their minds to issues of that nature" in the months ahead.