The Nigeria Employers Consultative Association (NECA) has called for the deregulation of the downstream sector of the oil and gas industry to boost the economy.
Director-General of NECA Timothy Olawale said this Monday at a stakeholders’ meeting of manufacturers in Lagos.
He said except fuel subsidy was removed, Nigerians would continue to suffer intermittent scarcity.
“There is the need for urgent deregulation of the downstream oil and gas sector.
“Over the last decade, the country has spent over N9 trillion on fuel subsidy; about N15.5 trillion on capital expenditure, N2.1 trillion on health and about N3.9 trillion on education.
“This is a misplacement of priority and shows that critical development such as education, health and infrastructure have suffered, due to the expenditure on fuel subsidy,” Olawale said.
He said the fuel subsidy regime had succeeded in creating phony and emergency billionaires, at the expense of millions of pauperised Nigerians.
The NECA boss said the fuel subsidy regime had contributed neither to the nation’s growth nor its people.
“We are where we are today because, in spite of past sound counsel, government has not been faithful to the deregulation of the PMS market of the oil and gas sector,” he said.
The non-deregulation of the petroleum sector, he further stated, had led the economy nowhere; but continued dependence on offshore sources for petroleum products.
“All we get is supply perennial shortage of petroleum products, loss of productive man hours, as a result of endless hours spent at filling stations, and massive corruption in the management of the subsidy dispensation,” he said.
The NECA boss also said increasing debt profile of the country, with huge percentage of the budget over the last decade was going to debt servicing.
He said borrowing could have been permissive, given the state of the economy in 2015, but not to the high level it turned out to be.
Olawale further said incurring debt for purposes of development was not in question, but the over N24.39 trillion debt stocks taking over 20 per cent of annual national budget to service debt should be enough source of worry.
He stated that government at both the federal and state levels should manage the rising debt profile, stating that this trend portends a gloomy future for the nation. (NAN)
Kachikwu explains queues
Meanwhile, minister of state, petroleum resources, Dr Ibe Kachikwu, has said the queues at filling stations were consequences of logistic challenges and had nothing to do with fuel scarcity.
Addressing journalists Monday in Lagos, Kachikwu said the public should ignore rumours of planned upward review of pump price of petrol.
The minister spoke to newsmen at the opening of the second edition of the Annual International Conference and Exhibition of the Oil and Gas Trainers Association (OGTAN).
He said there was no discussion within government circle about petrol price review and wondered how the rumours became pervasive.
“I took time to go round some stations in Lagos and I discovered that the queues which resurfaced had disappeared and let me tell you the issue of petrol pricing is a sensitive thing.
“You can see how the oil unions quickly reacted to the rumour and again the government is sensitive and engages stakeholders in every decision or policy it makes.
“Therefore, this spontaneous reaction and resurfacing of queues, despite assurances by the Nigerian National Petroleum Corporation (NNPC), is worrisome,” Kachikwu said.
He expressed confidence in the capability of NNPC’s management to maintain and meet the supply needs of the country, saying logistic gap which prompted the unnecessary panic had been resolved.
While stating that no system is perfect, Kachikwu said: “Sometimes you have some of these things happen but as a responsive and responsible government, alternative arrangements are always in place such that any gap is taken care of not to allow the situation to escalate.”
Also in a message to the event, NNPC Group Managing Director Maikanti Baru, said about 15 vessels laden with products had arrived the country.
He said the vessels had challenges discharging, especially at Warri port, but the situation had been resolved.
Baru, who was represented by the chief executive, national petroleum investment management services (NAPIMS), Roland Ewubare, said despite the challenges, the NNPC had about 1 billion liters of petrol which is equivalent of above 28-day supply, assuring the nation would not experience scarcity of any sort.
Earlier in his goodwill message, Kachikwu had challenged industry operators and stakeholders to take the issue of human capital development very seriously as Nigeria currently lagged behind in developing local capacity in the oil and gas industry.
The minister expressed concerns that the country had spent so much time dealing with issues around the sector but without tangible success stories to tell.
“I want to ask, how can we start building Floating Production Storage and Offloading (FPSO) and develop modules to transfer to the sub-region?
“When shall we allow market philosophy to drive the market with government providing enabling environment through adequate policies?
“When shall we begin to install our pipelines, build power plants, build our own refineries using in-country resources and attract private sector funding of projects and save government scarce resources?” the minister asked.
In his address, a former Head of State and chairman of the occasion, Gen. Yakubu Gowon, commended OGTAN for making human capital development a driver for national transformation which was the focus of the conference proceedings.
Gowon urged government to pursue policies and programmes that would help catalyse the development of a globally competitive human capital base for Nigeria, one steeped in innovation and critical 21st century skills.
“I know your industry is driven by breakthrough innovations in science and technology, such as the ones that brought about the shale revolution, which today, has impacted the industry and world economies.
“So, while we must build human capacities in science and technology, engineering and mathematical (STEM), skills,
let me also counsel that some of the efforts and resources are devoted to developing the leadership and the entrepreneurial competencies that compliment the later.
“This is the only way we can ensure the growth of indigenous enterprises to sustain domestic value capture in the country,” he said. (NAN)
