Eleven months after promising to build three new refineries for the country, the Federal Government may have dumped the plan.
Saturday PUNCH investigations
showed that the FG may have dropped the idea because of the unresolved
issue of deregulation of the downstream sector of the petroleum
industry.
This
development came to the fore as organised labour expressed surprise at
President Goodluck Jonathan’s N161bn supplementary budget on fuel
subsidy for 2012.
The labour body advised the President to tackle corruption in the oil sector.
The
President had in a letter to the National Assembly on Tuesday, said the
N888bn budgeted for fuel subsidy this year would not be enough.
But
as Jonathan is seeking an additional N161bn, the FG has yet to begin
moves to build the three refineries it promised during the fuel subsidy
protests last January.
The Nigerian National Petroleum Corporation had in 2010 unfolded plans to build three new refineries.
The refineries are to be sited in Kogi, Lagos and Bayelsa states.
The
NNPC Group Executive Director, Engineering and Technology, Mr. Billy
Agha, who stood in then for the Group Managing Director in Yenagoa,
Bayelsa State, had said 7,000 job opportunities would be created by the
Greenfield Refinery that would be built in the state by the corporation
in partnership with the China State Construction Engineering
Corporation.
Again in 2012, at the height of the fuel subsidy protests, the Federal Government said it would build three refineries.
The
Minister of Works, Mr. Mike Onolememen, who spoke to douse the tension
associated with the protests, had said, “I want Nigerians to know that
when these new refineries are completed, we will be a net exporter of
petroleum products and prices will begin to come down, just as we are
witnessing in the telecommunications sector with the GSM regime.
“That
is my message to Nigerians. Let us support the government. Let us join
hands with the government because it cannot and will not take any
decision with the aim of punishing fellow Nigerians. It is impossible.
So, Nigerians should have this at the back of their minds.
“The
one in Lagos is with the capacity of 200,000 barrels per day, while the
ones in Kogi and Bayelsa have the capacity to produce 100,000 barrels
per day.”
Investigations
at the NNPC showed that 11 months after the government promised to
build the three refineries, not much has been done to that effect.
A
top official of the corporation told one of our correspondents that the
three refineries were supposed to be part of the government’s effort to
stop fuel importation.
He
said, “The three refineries are to be built by the government in
partnership with the private sector. They do not include the six that
are solely private sector driven.
“But
from all indications, the government has developed cold feet and the
six by the private sector seem to be still-birth. There are various
stakeholders who prefer fuel importation. These are the people that will
not allow the plan to build refineries to succeed.”
President
Goodluck Jonathan had said that private investors were not interested
in building refineries in the country because of the fuel subsidy
regime.
He
had said, “Why is it that people are not building refineries in Nigeria
despite the fact that it is big business? It is because of the policy
of subsidy, and that is why we want to get out of it. Who will build
refineries and end importation of petroleum products? Subsidy must go.”
The
President had spoken in Abuja when he received the report of the
graduating participants of the Senior Executive Course 34, 2012 of the
National Institute of Policy and Strategic Studies.
Efforts to get NNPC’s comment on the status of the three refineries did not succeed.
Attempts
to speak with the acting General Manager, Public Affairs at NNPC, Mr.
Fidel Pepple, proved abortive as calls to his cell-phone did not go
through. It was learnt that he was out of the country.
Similarly,
attempts to speak with the General Manager, Media, Dr. Ibrahim Umar,
were unsuccessful. He neither picked calls to his cell-phone nor replied
a text on the status of the refineries.
Commenting
on the failure of the government to build the three refineries, the
President of the Trade Union Congress, Mr. Peter Esele, said the
President should fulfil his promise.
He
stated, “The people involved are just waiting for some form of
assurance to take off. The President should take that step to commence
action on it.
“He
has made a promise, those people want to do it, but they want a
guarantee from the government. It is important for the President to give
them this before they start. It is incumbent on the President to break
the ground for those refineries to be built. This thing has to do with
credibility.”
He expressed surprise over the N161bn supplementary budget on fuel subsidy the President submitted to the National Assembly.
Esele said that there was the need to address the corruption in the fuel subsidy regime.
According
to him, based on the increase in the pump price of fuel by 60 per cent
in January, the amount spent on fuel subsidy should have reduced.
He
said, “The thing came to me as a surprise because the pump price was
increased by 60 per cent in January. When we had N1.7trn, there was so
much corruption in the system. And now that we are getting the
corruption out of the system, the subsidy should come down drastically.
“At
least, it should reduce by over N500bn. It is expected that pump price
would have reduced. With this additional demand, there is the impression
that there is still corruption in the management of the subsidy.”
On her part, the president of the Campaign for Democracy, Dr. Joe Okei-Odumakin, described the present government as profligate.
She
said, “To spend N1trn on subsidy in a year at N32 per litre tax, which
was imposed on petroleum, is the height of fiscal recklessness.
“No country that runs on this template can make a progress.”
The
Petroleum and Natural Gas Senior Staff Association of Nigeria has also
urged the FG to repair existing refineries and build new ones.
The group warned that import-driven deregulation would ruin the nation’s petroleum industry.
President
of the association, Babatunde Ogun, said, “We call on the government to
ensure that the existing refineries perform optimally and new ones are
built within a specified time frame. It does not have to be giant
refineries, but pockets of refineries across the country, especially in
the oil-producing states.
“Similarly, operators in the upstream sector must be made to refine a specific percentage of their allocations locally.”
Punch Nigeria
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