A Review of the Nigerian Energy Industry

Labour demands state of emergency on Nigerian refineries

Victor Ahiuma-Young & Lazarus Ibeabuchi

04 September 2012, Sweetcrude, LAGOS – NIGERIA Union of Petroleum and Natural Gas Workers, NUPENG, has urged the Nigerian government to immediately declare a state of emergency on the nation’s four refineries to ensure they are rehabilitated and made to produce at, at least 80 percent installed capacity.

President of NUPENG, Comrade Igwe Achese, told Sweetcrude that in spite of the fraud allegation involving the House of Representatives Ad Hoc Committee on Subsidy Chairman and the owner of Zenon Oil, the report of the committee had vindicated labour’s position that the subsidy system was fraud ridden.

He said ,”We are aware of the good job done by the House of Representatives, when we raised the alarm on the issue of fuel subsidy. We are happy that, two years after we raised the alarm, today a report has been submitted by the National Assembly. But why is the issue of corruption and bribery coming to the table? That is to tell you, the alarm we raised and the investigation that was carried out by the lower chamber of the National Assembly, was in the right direction.

“It means actually there was a mismanagement of funds and corruption in the issue of subsidy. If these individuals are not involved, why will they come to allege that the investigation committee collected bribe from us? We quite agree with the Petroleum Products Pricing and Regulatory Agency, PPPRA, today that they have been able to do some sanitization to the issue of subsidy payment and the issue of product allocations have also been put under control.

“Currently, this country is suffering from inadequacy of petroleum products because none of our four refineries is working. Our refineries are not working and the only surviving means we are looking at today in the country is importation.

“That is an aberration to a country that is regarded as the sixth largest producer of hydro- carbon in the world. That is still the union’s concern, and we hope that in the course of these issues, the current ongoing diversion of the product, putting the crude oil into the off- Shore refineries, while turning our own refineries into a museum, will be addressed.

“As we speak to you today, we have information that, 445,000 barrels of crude oil per-day allocated to the four refineries is been diverted to the open market for sales or is being taken to the off Shore for refining and is being brought back for sales as an imported product.

“We are using this medium to tell those involved in this economic crime to stop this act before it is too late. We have been asking why is the Governor’s Forum not asking why are all these things are happening as members spoke for removal of fuel subsidy.”

According to him, “We are also requesting that the Federal Government should declare a state of emergency on the four refineries to ensure that these refineries are rehabilitated immediately. We are worried over this issue because, two years ago, we were told that these refineries would be rehabilitated, but it is still not at full capacity or at 80% after two years.

“Any time the refineries are about to come on stream, we hear there is no crude to refine. Even when they try to come up with the power plants, they will also find out that there is no crude oil in the tanks for these plants to refine. As I speak to you a lot of the filling stations, most parts of the country, petrol is being sold at N100 per-litre, because of government insensitivity to make sure that these refineries are being rehabilitated.”

“We have been told that they want to sell the refineries; they want to privatize them and so on. Before government can talk about privatization, the refineries must be rehabilitated and ensured that they are operating in their full capacity”.

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  • For us, there is an inherently flawed contradiction in the argument of organised Labour – even though they admit that the petroleum subsidy regime is fraud ridden, they insist on government continue with it. We really don’t understand.