Nigeria’s moribund four petroleum refineries in Warri, Port Harcourt and Kaduna would soon be handed over to private investors.
The Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Mele Kyari, said the corporation will no longer be involved in the management of the refineries after their rehabilitation.
Dr Kennie Obateru, Group General Manager, Group Public Affairs Division, in a statement in Abuja, said Kyari revealed this as a special guest on a TV programme.
He said that after completion of the ongoing rehabilitation exercise, the services of a company would be procured to manage the plants on an Operations and Maintenance (O & M) basis.
“We are going to get an O&M contract, NNPC won’t run it. We are going to get a firm that will guarantee that this plant would run for some time.
“”We want to try a different model of getting this refinery to run. And we are going to apply this process for the running of the other two refineries,” he said.
Kyari explained that the plan, ultimately was to get private partners to invest in the refineries and get them to run on the NLNG model where the shareholders would be free to decide the fate of the refineries going forward.
He stated that this model, which was totally different from previous approach, would guarantee the desired outcome for the refineries.
He added that the decision to finally end the fuel subsidy regime was in the interest of ordinary Nigerians.
According to him, this would free up funds for the various tiers of government to develop basic infrastructure in the education, health, transport, and other sectors.
“Subsidy is elitist because it is the elites that benefit from it. They are the ones that have SUVs, four, five cars in their garages.
“The masses should be the ones to benefit. There are many things wrong with the under-recovery because it makes us to supply more than is needed.
“This makes the under-recovery to be bloated because we unwittingly subsidize fuel for the whole of West Africa. That has to stop,” he said.
He explained that the removal of subsidy would automatically correct the distortions it created in the market such as products arbitrage and smuggling.
He said that it would also provide the needed impetus for the NNPC to establish retail outlets in neighbouring countries.
On the agitation in some quarters for a reduction in the price of kerosene, he said the corporation’s focus was rather on how to migrate all those who were still using kerosene for domestic cooking to the use of Liquefied Petroleum Gas (LPG) also known as cooking gas.
According to him, apart from LPG being a cheaper fuel than kerosene, it is also safer and more environment-friendly.
By Anthony Areh