President has joined the clamour for the removal of subsidy on petroleum products, saying continued regulation of products prices has led the government loss of resources.
Minister of Petroleum Resources Diezani Alison-Madueke, who spoke on his behalf at the opening of the 35th edition of the Society of Petroleum Engineers (SPE) Annual International Conference and Exhibition (NAICE) in Abuja, said the high cost of petroleum products subsidies has limited the government’s ability to create the enabling environment for private sector investment in Nigeria’s downstream petroleum industry.
“Significant national income has been expended so far on price regulation of refined products in the domestic market…This significant drain in the national resources has limited government ability to provide a sustainable basis for private sector downstream investment and development,” Jonathan said.
Of recent, governors and petroleum marketers have been agitating for the removal of petroleum subsidies to free cash for infrastructural development and pay the N18,000 minimum wage. The governors are also pushing for the review of the revenue allocation formula to give the states a higher percentage.
The President said the Nigerian National Petroleum Corporation (NNPC) has been mandated to build three new refineries, in addition to rehabilitating existing ones to meet the country’s common objective of attaining self-sufficiency in petroleum products soon. According to him, Nigeria’s national energy policy recognises the multi-dimensional nature of optimal energy resources management, at the same time, it addresses diverse issues such as energy efficiency, environmental stewardship, research and development, as well as energy pricing and financing along the entire oil and gas value chain.
He said the overall thrust of the nation’s energy policy was in the optimal utilisation of the nation’s energy resource mix for sustainable development through increase in the pace of oil and gas exploration, development and production, internal sufficiency in petroleum products and export of value added excess as well as liberalisation and deregulation of the downstream sector and progressive privatisation of the oil and gas industry to bring in private sector efficiency that will engender sustainability.