An independent budget monitoring agency, BudgIT, has called on President Muhammadu Buhari to privatise all government-owned refineries to fully deregulate the petroleum downstream sector. The call, according to the body is based on its new policy brief entitled “Inside Nigeria’s Local Refineries”, which indicates that government-owned refineries in Kaduna, Port Harcourt and Warri incurred a cumulative loss of N32.8 billion in 2017 and N126.2 billion in 2018, making a total loss of N159 billion in the last two years under Buhari.
A statement made available to Daily Sun by the Communications Associate of BudgiT, Shakir Akorede, noted that the combined refining capacity of the refineries is incapable of meeting Nigeria’s demand, thus putting the country in a precarious situation that compels it to import more than 91 percent of its products consumed locally.
The agency said: “It is instructive that only one private refinery, Niger Delta Petroleum Resources (NDPR), has commenced operation in Nigeria despite the country issuing over 44 refinery licenses to investors so far – some of them issued since 2007. Of these licenses issued by DPR, 15 are already expired. It is no coincidence that the only Modular Refinery that has commenced operation is the NDPR which produces AGO (diesel), one of the refined petroleum products that are fully deregulated. “On the heels of the foregoing, BudgIT is asking the Nigerian government to deregulate the downstream sector’.
This will make many stagnating private-sector refinery projects more attractive to investors, it maintain. Navy smashes trans-border oil syndicate, arrest 9 foreigners(Opens in a new browser tab) “If the remaining 29 refinery projects with active licenses come on stream, Nigeria will successfully unlock refining capacity of nearly 32.7billion litres of PMS per year, 19.6billion litres of Diesel per year and 6.5billion litres of Aviation fuel per year. This will be sufficient to meet the country’s refined products needs and also supply the West African market,” noted Gabriel Okeowo, BudgIT’s Principal Lead.