To inject $15bn into oil sector
By Adetutu Folasade-Koyi
Vice-President Yemi Osinbajo has revealed how the Federal Government saves N15.4 billion monthly from fuel subsidy removal.
Osinbajo disclosed this in Abuja, yesterday, at the presentation of the 2016 Scorecard of the Ministry of Petroleum Resources and Agreements Signing ceremony for Joint Venture Cash Calls (JVC) exit.
Represented by the Attorney-General of the Federation and Minister of Justice, Abubakar Malami, Osinbajo also disclosed that $15 billion would be injected into the sector.
”I am pleased to be the special guest of honour at the agreements signing ceremony for Joint Venture Cash Call exit and the announcement of $15 billion investments to be done in the sector.
”The oil and gas sector remains critical to the stability and growth of our economy as it accounts for about 90 per cent of earnings.
”Amongst others, the downstream sector has been deregulated with the elimination of petroleum subsidy.
”This policy has removed from government, a burden of not less than N15.4 billion monthly,” he said.
The vice-president also added that the federal government had taken steps to raise the domestic refining capacity for petroleum products by repairing the existing refineries.
”We have also licensed modular refineries and supported the development of private refineries, one of which is a 650,000 barrels per day capacity.”
He also explained that repair of one of the refineries is nearing completion, and added that when completed, it will restore ‘’our pipelines to facilitate crude and products transportation.”
Also speaking, Minister of State for Petroleum Resources, Dr. Ibe Kachikwu said when he took over the leadership of the ministry, oil sector was losing N1.2 trillion every year and fuel scarcity was common.
”Today, we have a situation where refined petroleum consumption has gone down from an all-time high of 40 million litres a day to about 28 million litres a day.
”On cash call, the issue was how long the upstream was going to continue to bleed as investments were drying up and activities grinding to a halt.
”For the first time in 2017, you are going to see the ministry driving an effort with the Department of Petroleum Resources (DPR), to find leakage areas, essential to cover the gap in the 2017 budget.
”In the Niger Delta, we have brought the all-time low production of 1.3 million barrels per day (mbpd) to 1.8mbpd, but for some minor incidents, it would be closer to 2.1mbpd or 2.2mbpd.
”We set a zero militancy target in 2017 and we want anything that needs to be done to be done,’’ he said.
In her welcome address, the ministry’s Permanent Secretary, Dr Jamila Shua’ra, said ”the year started with refineries producing below capacity, high demand for petroleum products and insufficient supplies at depots, forex shortages.
“However, President Muhammadu Buhari believed in our team and our collective ability to find solutions.
“Although, it is not Uhuru yet, there are many more rivers to cross. As we speak, aviation fuel remains a challenge.
”We are yet to pick maximum capacity in our refineries and there is need for more investors to fund massive infrastructure development in the sector.”