Home Uncategorized Reps mull sale of refineries, subsidy removal

Reps mull sale of refineries, subsidy removal

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Concerned with the huge funds sunk into the nation’s non- functional refineries and the amount spent to finance the fuel subsidy regime, the House of Representatives yesterday mandated its committees on Petroleum (Upstream/ Downstream) to investigate the state of the refineries in the country.

Both committees, which have four weeks to report to the House, are to advise on subsidy removal and privatisation of the refineries.

The resolution followed a motion  by Omeregie Ogbeide-Ihama (PDP Edo), entitled: “Call for the discontinuance of the operations of Nigeria’s refineries due to heavy debts incurred by the refineries and the need for the Federal Government to privatise the refineries.”

The lawmaker called on the Federal Government to privatise the refineries because they were a drain pipe on the country’s finances.

According to him, Nigeria should not continue to spend heavily on subsidy and maintain ineffective refineries, adding that the Group Managing Director of the Nigeria National Petroleum Corporation (NNPC), Dr. Emmanuel Kachikwu, had said government-owned refineries managed by the NNPC were not making profit.

He added: “The Kaduna Refining and Petrochemical  Company, Port Harcourt Refining Company and Warri Refining Company were reported by the NNPC to have incurred debts amounting to about N120.7 billion in August and September, 2015.

“While their revenue in August was N146.617 billion, their expenditure was N207.287 billion in September. The revenue generated by the refineries was N122.514 billion and the expenditure was pegged at N171.914 billion .”

Members supported the motion and agreed that the country was spending unnecessary huge funds on the nation’s refineries.

They called for the privatisation of the refineries as well as the stoppage of the subsidy regime.

Leo Ogor, Minority leader agreed with the motion, saying: “The refineries have become a major drainpipe. This is the truth. We said government has no business with business. There is no country in the world that spends this kind of money on financing other countries’ imports. It does not make sense to me.

“The subsidy money is borrowed and we’re going to continue to import. This money can be useful in the education and health sectors. We will save scarce foreign exchange. We should put this challenge behind us.”

However, Majority leader Femi Gbajabiamila, while agreeing with the call for privatisation of the refineries, cautioned his colleagues on the dangers of wrong timing.

Gbajabiamila said: Privatisation of the refineries and removal of subsidy “will skyrocket the price for the common man.”

He said the question members should be asking is: “Why are refineries working all over the world and not working in Nigeria?”

The lawmaker wondered why people want the basic necessities of life in Nigeria privatised. “Then, what is the basis of government?”

At this point, the Speaker, Yakubu Dogara, joined in and directed the committees on Petroleum Resources (Upstream/Downstream) to probe the state of the nation’s refineries.

The committees have four weeks to report to the House.

 

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