A Review of the Nigerian Energy Industry

Refineries privatisation, way forward in petroleum industry – Alison-Madueke

Warri-refinery11 March 2014, Abuja – Minister of Petroleum Resources,  Mrs. Allison-Madueke, on Tuesday said the privatisation of the nation’s refineries remained the best way to tackle the problems in the petroleum sector.

Allison-Madueke stated this when she appeared before the Joint Senate Committee on Petroleum Resources (Upstream, Downstream and Gas) to defend her ministry’s 2014 budget in company with senior officials of  the ministry and heads of agencies under her supervision.

She, however, said the Federal Government was continuing with the rehabilitation of the refineries, improvement of facilities and provision of enabling environment for operators of both the upstream and downstream.

She said the process of privatisation would have been concluded if the various trade unions within the petroleum industry had not protested the action.

She said, “The way forward is the privatisation of the refineries because government should not be involved in the business of fuel sales”

The minister assured Nigerians that the federal government will in the next few weeks, flood Nigerian petrol stations with fuel in order to arrest the current scarcity.

She also said punitive measures would be taken against owners of fuel stations either diverting or hoarding the product.

She said,  “I wouldn’t call the current fuel shortage a recurring development because there has been no shortage in the last three years until two weeks ago. The shortage has a lot to do with a number of issues.

“First, there seems to have been some scare or rumour that the federal government wanted to increase the pump price of petroleum products and I have said it categorically that the Nigerian government had no intention of increasing the pump price of petroleum products,  anytime in the near future. That is for certain.

“Secondly,  whether it is as a result of rumour or supply issue,  there was a certain level of burden and we found out too that there was a certain level of diversion of petroleum products as well.

“All of these we are trying to ensure that they are brought to an end very stoutly in this period and as a result I have been going out to monitor the fuel distribution and talk to petrol station owners in Lagos and to consumers as well just to get an understanding of where they had had the worse shortages over the last couple of weeks but it is coming under control now.

“We will be flooding the market with petrol over the next few weeks and beyond to ensure that whatever it is that is causing the shortage, whether it is fuel diversion or rumours of pump price increment, it is dampened by force.

“Those that are found to be actually diverting fuel or hoarding, even after all that we had done, during the period will undergo punitive measures. If we have found a filling  station on our list to be diverting or hoarding,  no matter who owns the station,  whether it is owned by the NNPC,  they would face the same punishment.”

On the 2013 budget, the minister said her ministry performed fairly well to the tune of about 87 per cent implementation based on the actual releases.

On the 2014 budget, she said “we have a budget figure of about N60bn for the entire ministry both recurrent and capital expenditure.”

“Unfortunately recurrent takes a lot out of every budget in the system. The capital is much less but we intend to move forward as much as we can by ensuring that all the ongoing projects are completed while new projects like LPG framework are carried forward.”

Madueke however complained that her ministry had the challenges of funding, inadequate facilities  sabotage and vandalism, oil theft, and oil spill which affected the nation’s resources as a nation.

Meanwhile,  the Chairman, Senate Committee on Petroleum Resources (Upstream),  Senator Emmanuel Paulker, had asked the ministry to write formally, details of how its officials spent the N521m to carry out enlightenment campaigns on the Petroleum Industry Bill.


– The Punch

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