Ike Amos
15 February 2018, Sweetcrude, Abuja — The Federal Government, Thursday, said it is highly concerned about the unending fuel crisis currently witnessed in the country, while it ordered the Nigerian National Petroleum Corporation, NNPC, to step up activities and ensure that the crisis comes to an end before the end of this week.
Speaking to newsmen on the forthcoming Nigerian International Petroleum Summit, NIPS, scheduled to hold between February 18 and 22, 2018, Minister of State for Petroleum Resources, Mr. Ibe Kachikwu, also stated that the government was interested in hiking the price of petrol.
He said the perennial fuel crisis was a function of both logistics and policy issues, stating that efforts are being made to enable fundamental policy issues that would tackle the fuel crisis.
He said, “I would be instructing the NNPC, to do whatever it takes to ensure that we do not bring visitors here next week and we experience fuel queues. We have to do whatever it is, to get this eliminated in Abuja. That is the directive I would giving to the NNPC. Let them work night and day and put a lot more effort.
“I can tell you that behind the scenes, a lot of meetings are taking place because the fuel queue issue is both a logistics and policy issues. We will need to address the fundamental policy issues to enable it to go away, especially in an area where it is showing a differential between the landing cost and the sales price. We need to walk back to see what we need to do to be able to continue to sell at N145.
“The president is obviously very committed to keeping the fuel price at the point where it is because he realizes and sympathises with the sufferings of Nigerians. We did a massive price hike two years ago under me. We do not intend to do that again. We need to walk backward. It requires a lot of efficiency re-engineering and that is one of the things the NNPC and most of the parastatals involved in this are doing.”
He further stated that the country was not moved about the dropping crude oil price, stating that it presents an opportunity for OPEC and its member countries to look inwards and take far-reaching decisions that would see cost coming down and bring about an increase in the efficiencies.
He said, “Shale is going to be active. We know that whenever we are in excess of $65, shale gets very active because the fundamentals become much more supportive of more investments and more production lines.
“I have always said that two things need to happen. OPEC needs to just focus on itself and on what it needs to do and forget about what is happening in shale. Two is that every OPEC producer must work hard to become a least-cost-producer.
“The truth is that if shale can produce at $65, there is no absolutely no reason why we should be struggling. The fundamentals of our earnings, how efficient we are, our cost of production is work that we need to do internally. That does not depend on OPEC.
“If you look at what is happening at Saudi Arabia and UAE, there is a fundamental rejigging of their production models to ensure that they are getting the very best in terms of their prices and their cost is going down. One nice thing about low prices is that it forces everybody to abandon high-cost production. Even for the projects, we are doing today, we are looking at it again to see if it makes sense; whether if the oil in the ground is not going to yield money to the Federal Government. We are doing a lot of work on the cost aspect.”
