NNPC says 25 licences for oil refineries lying unused amid costly imports
By Jeph Ajobaju, Chief Copy Editor
About 25 licences granted for the establishment of oil refineries in the past 10 years have not be used, according to the Nigerian National Petroleum Corporation (NNPC).
NNPC Group Managing Director Mele Kyari made the disclosure at a summit organised in Abuja by Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN).
“As of today, close to 25 licences issued to companies to establish refineries are dormant. As long as we do not have certainty around pricing, no one will put in his money. And as long as we have arbitrage, things will be difficult,” he said.
On corruption in the oil sector, Kyari explained fraud is likely once the price differential between one location and another is substantial.
“People will do everything possible to move products between locations; whatever it is, whether it is drugs or petroleum. This will happen, and people will cut corners as long as the market does not determine prices.
“Should the market always determine the price of commodities? Yes. But should it be managed? I agree. And that is what a framework of managing pricing can do for a country.”
He stressed every country has one form of subsidy or another, and there is no reason why Nigeria should not implement one.
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Impact of subsidy removal, naira float
PENGASSAN President Festus Osifo lamented the impact on workers of subsidy removal and floating of naira-dollar exchange rate, saying both policies benefit only the government and oil and gas companies, per The Guardian.
He urged Nigeria to follow the example of Angola which pays its workers’ salaries in dollar equivalents to prevent erosion of income by inflation.
Senate President Godswill Akpabio, represented by Senate Gas Committee Chairman Agom Jerigbe, explained fuel subsidy was meant to give Nigerians a better life but it turned sour because of massive corruption and inefficiency.
“Nigerians should watch out for this [10th National] Assembly in the middle of our national life and the front lines of action in defence of our people,” he promised.