THE ZOOLOGICAL REPUBLIC DENIES APPROVAL OF THE SALE OF FOUR REFINERIES.
Govt reverses self to avert oil workers strike
The Presidency yesterday denied that there are plans to sell
any of the four refineries in the country.
The denial is to forestall a strike by unions in the oil
industry, who are opposed to the plan.
Special Adviser to the President on Media and Publicity, Dr.
Reuben Abati, in a statement in Abuja said there was no basis for the Petroleum
and Natural Gas Senior Staff Association of Nigeria, PENGASSAN, and the
National Union of Petroleum and Natural Gas Workers, NUPENG, to embark on
strike as government has no intention of selling the refineries.
But the denial contradicts the disclosure of the Minister of
Petroleum Resources, Mrs. Diezani Allison-Madueke, who in a recent interview
with Bloomberg TV Africa in London had said that the refineries would be sold.
“We would like to see major infrastructure entities, such as
refineries, moving out of government hands into the private sector. Government
does not want to be in the business of running major infrastructure entities
and we haven’t done a very good job at it over the years,” Alison- Madueke had
said.
But Abati explained that the Federal Government was not
considering selling the refineries and appealed to PENGASSAN and NUPENG to drop
the idea of embarking on strike.
“Government is not going to sell any refineries. There is no
such plan and there is no presidential approval for such. Nobody, not even the
minister of petroleum has powers to sell any government property,” he said.
The four refineries are located in Warri, Kaduna and Port
Harcourt with a combined capacity of 445,000 bpd.
It would be recalled that a presidential audit of the
refineries, led by a former Minister of Finance, Kalu Idika Kalu recommended
that they be sold off, due to inadequate government funding and sub-optimal
performance.
In a related development, the Ministry of Petroleum
Resources also yesterday dismissed speculations that the Federal Government
plans to increase pump price of petrol through a full or partial withdrawals of
subsidy.
Permanent Secretary in the ministry, Mr. Danladi Kifasi,
said this in a statement made available to National Mirror in Abuja.
He said that government had no plan to increase the pump
price of Premium Motor Spirit (PMS) from the prevailing price of N97 per litre.
The Permanent Secretary dismissed fears in some quarters
about an impending price hike describing it as “unfounded”.
“We would like to appeal to oil marketers to refrain from
the hoarding of petroleum products and the general public from panic buying in
anticipation of any increase in pump price.
“It is equally important to state that neither the Federal
Ministry of Petroleum Resources nor any of its parastatal is under any
instruction to activate a new pump price regime as being speculated,” he said.
Kifasi further warned petroleum product marketers to desist
from creating any scarcity so as to induce panic in the system in order to
exploit unsuspecting members of the public.
“The relevant agencies of government including the
Department of Petroleum Resources, DPR, and the Economic and Financial Crimes
Commission, EFCC, have been directed to deal with offenders,” he said.
Kifasi assured that the government had made enough
arrangements to ensure that the entire nation remains “wet” with petroleum
products round the clock in 2014 just as it has been the practise in the last
three years.
President Goodluck Jonathan had in March, said that the
Federal Government would still remove fuel subsidy, even after a sudden removal
in 2012 triggered public outrage.
He had, however, said that government would first discuss
the proposal with Nigerians before removing the subsidy.
Giving reasons at that time he had said: “We cannot continue
to waste resources meant for a greater number of Nigerians to subsidise the
affluent middle class, who are the main beneficiaries (of fuel subsidy).
“We believe that as we progress, government is going to
continue to enlighten Nigerians on the need to remove fuel subsidy.”
Government had suddenly announced the total removal of
subsidy on petrol on January 1, 2012 with pump prices rising to N141 per litre
up from N65.
The action triggered massive weeklong nationwide protests
forcing the government to partially return the subsidy and reduce petrol price
from N141 to N97 a litre.
If the subsidy were to be removed today, petrol price would
jump to N143.63 per litre based on the current Petroleum Products Pricing
Regulatory Agency, PPPRA, template.
PPPRA statistics showed that government’s subsidy, which
stood at N53.53 per litre in September has fallen to N46.63 per litre.
The latest pricing template of the agency indicates that the
landing cost, including cost and freight, traders’ margin, lightering expenses,
NPA, financing, jetty depot throughput charge, and storage amounted to N128.14.
It stated that distribution margins, including monies due to
retailers, transporters, dealers, bridging fund, marine transport average and
admin charge amounted to N15.49.
The PPPRA, which puts ex-depot price at N81.51, stated that
these expenses increased the total cost of the product to N143.63 per litre.
This means that the government’s subsidy is N46.63 per litre
because the price of the product remains pegged at N97 per litre.
Current information indicates that total petrol subsidy bill
dropped from over N1.9 billion recorded in September to N1.6 billion in
December based on the estimated daily consumption of 36 million litres.
Investigations showed that the major and independent
marketers have started preparing their fourth quarter subsidy claims for
submission to PPPRA for settlement.
While the major marketers, including Oando, Forte Oil, MRS,
Mobil, Total and Conoil were paid for the first, second and third quarters of
2013, others, including the independents have not been paid.
Some hawks in the Federal Ministry of Finance still believe
that the subsidy should go, but the Jonathan administration, fearful of a
political backlash ahead of the 2015 elections has been forced to maintain the
status quo.
Stringent verification procedures for the payment of fuel
subsidy and a crackdown on fraudulent importers have reduced the corruption in
fuel import and subsidy payment programme over the past one year.
The planned privatisation of the refineries and expectations
of new investments to increase local refining capacity would bring an end to
fuel importation, long considered as a national embarrassmen
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