In 2008, President Umaru Yar’Adua reversed the $750m sale of the 51% stake in two of the Nigerian National Petroleum Corporation’s refineries to a consortium led by business mogul, Aliko Dangote.
Incidentally, according to BudgIT, a non-profit research advocacy group, between 2006 and March 2020, the federal government had spent over N11.6tn on fuel subsidy, while fuel imports between 2013 and 2018 cost Nigeria N15.21tn, according to records obtained from the Bureau of Petroleum Enterprises and National Office of Statistics.
Between 2014 and 2018, the NNPC admits its losses on its refineries amounted to N1.64tn, and it has yet to release figures of losses incurred between 2009 and 2013. Evidently, had Dangote’s consortium been allowed in 2008 to take over these two refineries that are moribund today, he would not be spending $9bn building a new refinery.
Those two refineries would also have reduced or eliminated completely importation of petrol, which has ended up benefitting foreign economies and private pockets. Worse still, the money spent by the federal government on fuel subsidy from 2009 to March 2009 would have been channelled instead into other initiatives.
It is instructive that governance in Nigeria has been and continues to be a plethora of bad decisions taken by those entrusted with power, all with a seeming intent to bankrupt the Nigerian state. The bad decisions come in the form of loans being taken primarily from China to build infrastructure, and others taken to meet the recurring expenditures of government.
Others are hidden out of sight like the loans being taken by the NNPC to fund some of its infrastructure projects whose terms never went through public scrutiny. Many others are buried in strange agreements in which the federal government has assumed a financial liability in the event of a contract default similar to the $9bn arbitration award in favour of the P&ID.
The cumulative costs of these bad decisions will eventually get to a tipping point, and almost did during the last Covid-19 global lockdown that knocked down oil prices. It will surely come; it’s just a question of how soon the next shaking occurs. Nigeria will take a direct hit and the bottom will fall out of the bucket with devastating consequences.
The only positive here is that both those responsible for these bad decisions past and present, and those that have been at the receiving end of it, are all stuck in Nigeria. When the cumulativeness of these bad decisions are jolted by the next shaking, there will be no binding place, the rich and poor alike will finally face up to the consequences of their folly.
Kingsley Omose Esq
Apapa, Lagos state