Opinion
Dangote Refinery Begins Production, NNPC Refineries – Matters Arising
It’s strangely interesting that the NNPC who had, for over two decades, been involved in an open-ended Turn Around Maintenance, TAM, of the three refineries of Portharcourt, Warri and Kaduna refineries, chose to kill the joy of Nigerians on the same day that the Dangote refinery announced the refining of crude oil at her 650,000 BPD capacity refinery and the presentation of Europe-V quality petrol to Nigerians with another hike of the price of petrol to N817 per litre!
The audacity of the NNPC to raise the price of a litre of petrol to N817, especially when Nigerians are still grappling with the “Subsidy Is Gone” misadventure of May 29, 2023, cannot be waved aside not to have had the tacit approval of the Minister of Petroleum.
Strangely, what is the nexus between the announcement of Dangote refinery’s commencement of refining operations and the NNPC’s hike of the price of petrol, barely an hour of that announcement by Dangote? What is the NNPC not telling Nigerians? And, what is it trying to tell Nigerians with the sudden hike of the price of petrol?
Unashamedly, the NNPC announced the price hike when it has led Nigerians on an escapade, endless loss of billions of dollars on the TAM of the Portharcourt, Warri and Kaduna refineries without accountability.
Sanusi Lamido Sanusi, the Emir of Kano, had consistently, openly criticised the NNPC as an organization that runs her operations in opaque tradition.
The Portharcourt refinery has missed the September 1, 2024 deadline for it to commence production of refined petroleum products, especially after many missed promises by the GMD of the NNPC since December 2023, January 2024, March 2024, August 2024 and September 2024!
Nigerians have lost count of the different dates given by government officials for the resumption of refining activities at the Port Harcourt, Warri and Kaduna refineries.
The spending of $1.5 billion for repair of Port Harcourt refinery, $897.6 million for repair of Warri refinery and $586.9 million on the Kaduna refinery repair raises eyebrows, with critics questioning whether it is a profitable venture considering Nigeria’s precarious fiscal challenges. Allegations of graft are rife and linked to NNPC and government officials. So much of Nigeria’s resources have been wasted under elaborate maintenance that leaves the refineries poorer than they were and their managers richer than they should have been.
In the penultimate month of August 2024, the NNPC regaled Nigerians that it made a profit of about N3. 297 trillion at the close of the financial year which ended in December 2023! Within that month’s cycle, it surreptitiously, indirectly admitted and told Nigerians that subsidy is being paid on imported petrol!
Preparing the grounds for the announcement of another hike on the price of petrol, the NNPC shocked Nigerians and admitted that she owes petrol suppliers a whooping 6 billion Dollars albeit her aggressive, robust denial when newspaper reports alleged that debts owed suppliers of petrol are chiefly responsible for fuel scarcity.
Recall that Nigerians celebrated the passage and signing into law, the PIA Bill – that Bill, perhaps did not address the monopolistic role of the NNPC on Nigeria’s oil sector, especially in the coming on stream of private refineries, led by Dangote refinery, a private sector initiative and an organization that has its corporate policy to make profit, far from the unwieldy, opaque NNPC that has not declared profit through the past years of operations but in year 2024! As a behemoth monopoly corporation, why should the NNPC, apart from her abysmal management of three Nigerian refineries, be appointed as ‘Off-taker’ of petrol refined and produced by the Dangote refinery to marketers. ‘Off-taker’ is a euphemism that the NNPC has become a middleman in the distribution chain of refined products of Dangote refinery. As a middleman, the NNPC will add a mark-up price to every litre of petroleum products from the Dangote refinery, and this will directly increase the price of petrol sold to Nigerians!
The NNPC and her affiliate agencies are supposed to be regulators of privately owned refineries – it should supervise Dangote refinery activities on refining, product-pricing, distribution and sales. But as an Off-taker, it will further increase the price of petrol to Nigerians who are yet to come to terms with the recent hike on the price of petrol, when they are still grappling with the pangs of subsidy removal, low earning power, electricity tariff hike and hunger.
The Minister of Petroleum, President Tinubu, so far, is far away in China, while the NNPC is tightening the noose on hapless Nigerians. Nigerians have lost hope waiting for hope – Nigerians are dying daily from inflation, unemployment.
When has it become the tradition that an external entity should fix the price of a product for the manufacturer/producer?
Why is Dangote Refinery not willing to tell Nigerians the price of a litre of her refined petrol but eager to say that the NNPC, the President and his Cabinet will tell Nigerians what a litre of her petrol will cost?
Naturally, having been supplied crude oil in Naira, it naturally follows that the refined petrol from Dangote refinery should be sold at a price that is less than the value of the Dollar at the parallel market – cheaper than imported petrol. Any thing contrary to this pricing scenario will further impoverish an already hope-lost Nigerians.
Perhaps President Tinubu should not have said “Fuel subsidy is gone”, that unfortunate, ill-thought statement that had opened the doors of hopelessness on hapless, hopeless, weary Nigerians since May 29, 2023. It’s time for President Tinubu to fire the Minister of Petroleum for his abysmal poor performance. Also, the time is now ripe for President Tinubu to fire the GMD of the NNPC, Mele Kyari and his management team of the NNPC and NNPCL if he is genuinely serious about providing succour to Nigerians in the middle of his harsh economic policies.
By Onorakpene Eviosekwofa