Mohammed Idris, minister of information and national orientation, spoke at the third edition of the ministerial press briefing series in Abuja on Wednesday.

“Petrol importation has been reduced by 50 percent since the withdrawal of the fuel subsidy,” the minister said.

Idris attributed the progress made to the removal of petrol subsidy by the federal government led by President Bola Tinubu.

“I am also happy to report that there is the NBS, there is a capital importation that has risen to about 66 percent in this quarter as against the 36 percent that happened in the last quarter before the withdrawal of the petrol subsidy.”

Additionally, the minister said local oil production has risen from 1.22 million barrels per day (bpd) in the second quarter (Q2) of 2023 to about 1.55 million in the fourth quarter (Q4) of 2023.

“We also know that our domestic refining capacity, according to the NBS, has also risen by about 8 percent,” he said.

On May 29, 2023, Tinubu announced the removal of the subsidy on petrol, consequently increasing the price of the product exponentially across the country.

Speaking on Tuesday at the the 7th Nigeria International Energy Summit (NIES) in Abuja, Tinubu had said the subsidy removal policy was a challenging but necessary decision to secure the country’s energy future.

He said the payment of petrol subsidy strained the country’s resources over the years and hindered investments in critical infrastructure.

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Declaring the 7th Nigerian International Energy Summit (NIES) open in Abuja, the president added that the stoppage has the potential to attract more local and international investors.

The theme of the summit is “Navigating the New Energy World Order: Security, Transition and Finance.”

Tinubu was represented by the Minister of Information and National Orientation, Alhaji Mohammed Idris Malagi.

According to him, through the phasing out of subsidy, the federal government has created a more transparent and accountable sector.

He noted that the funds that were formerly spent on subsidy is now channeled into the development and upgrading of the nation’s energy and other social infrastructure.

Tinubu said: “By removing the subsidy, we are creating a more transparent and accountable energy sector.

“The funds that were previously allocated to subsidizing petroleum products are now redirected towards developing and upgrading our energy and other social infrastructure.

“Furthermore, the removal of the subsidy has encouraged further private sector participation in the energy industry, with the potential to attract more local and international investors, and foster innovation and competition that will drive down costs and improve the overall efficiency of our energy sector.”

The president, who admitted that the removal of subsidy will negatively impact low-income earners, stressed that, in parallel with the subsidy removal, his administration is committed to implementing social intervention programs to mitigate the short-term effects on vulnerable populations.

These programs, according to him, will ensure that the burden of the subsidy removal is shared equitably and that the most vulnerable are protected.

He added, “The decision to remove the petroleum subsidy is not an easy one, but it is a necessary one for the long-term energy security and economic prosperity of our beloved nation. I call upon all stakeholders, including industry experts, policymakers, and the general public, to engage in constructive dialogue and collaboration as we navigate these challenging but transformative times. Together, we can build a resilient and sustainable energy future for Nigeria.”

He charged the stakeholders in the summit to leverage innovation and collaboration to ensure a smooth and just transition that will leave no one behind.

He said finance plays a pivotal role in driving the energy agenda. Adequate funding, said Tinubu, is crucial to support the development and deployment of cutting-edge technologies, infrastructure, and projects that will shape our energy future.

He insisted that “as a nation, we must explore innovative financing models, engage with the private sector, and attract investments that will propel us towards a more resilient and diversified energy sector.”

The Nigerian National Petroleum Company Limited (NNPCL), Group Chief Executive Officer, Malam Mele Kyari revealed that the firm has begun the tunnelling of the River Niger for OB3.

He said NNPCL is committed to developing the deepwaters going forward.

He said the company has substantial access to capital today. Kyrie also noted that there was a shortage of investment support, and that is the reason NNPCL supports the African Energy Bank with capital.

He said there is the current challenge of the security of assets, but Tinubu is working hard to tackle that to earn investors confidence to deliver production to the market.

Meanwhile, the Minister of State Petroleum Resources (Oil), Senator Heineken Lokpobiri said Nigeria has so many idle wells, that it needs to ramp up production.

The minister called for an increase of upstream production to get the right quantity that will service local and international obligations.

He said, “Dangote Refinery needs about 650,000 barrels a day. We are rehabilitating our government refineries, which need about 440,000 barrels per day.

“We have a couple of modular refineries that need oil. So on the whole we need to ramp up production so that we will be able to ramp up our domestic needs, guarantee energy security locally.”

The minister said the Port Harcourt Refinery has started operation.
According to him, Nigeria has no business importing fuel.

Lokpobiri said now that the domestic refineries are being rehabilitated that will come into full operation by the end of this year.

He said: “Some of them have started, Port Harcourt Refinery has start. Warri is about to be completed between now and the next two months. Kaduna will come up. At the end of this summit we should be able to come up with finance because finance comes with investment.”

He insisted that Nigeria is not stopping the exploration of fossil fuel, noting that the country will develop it in a sustainable manner.

He said the international oil companies are not leaving the country but they were only leaving for the offshore deepwater.

He noted that the western world clamouring for energy transition was still developing hydrocarbon.

“The West is not slowing down oil exploration. But we are being asked to slow down or stop investments in fossil fuel,” he said.

According to him, Africans are only the victim of oil exploration and not the problem.

He said: “You the West is responsible for the emission.”

Speaking, the Minister of State for Petroleum Resources (Gas), Hon. Ekperikpe Ekpo, dropped the hint that the Obiafu/Obrikom/Oben (OB3) will be completed by March 2024.

He said the project is a vital piece of gas infrastructure for the supply of feedstock to the AKK pipeline.

This pipeline, said the minister, is among Nigeria and Africa’s biggest gas transmission systems.

Ekpo said: “Per the Contractor’s estimates, I am pleased to announce that the OB3 pipeline will be completed by March 2024, and the 42” 127 km pipeline will supply 2BCF daily. “Upon completion, this pipeline will provide the AKK pipeline with gas from the three fields of Obiafu, Obrikom, and Oben.”

Ekpo recalled that on September 12, 2023, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) announced the successful bidders for the Nigerian Gas Flare Commercialization Program.

Out of 300 interested entities, 42 were chosen, receiving 40 flare sites for independent development, while 4 entities got 9 sites each for cluster development.

He noted that the allocated entities are expected to commence full operations on their sites this year.

The minister said: “Another milestone in our journey towards a gas-focused economy is the Ajaokuta-Kaduna-Kano (AKK) pipeline.

“I am pleased to report that significant progress has been made in constructing this critical infrastructure project, and we are on track to ensure its completion and commissioning as scheduled.”

The minister noted that the government will continue the development of the necessary infrastructure to ensure widespread access to clean and affordable natural gas for domestic consumers and encourage the adoption of compressed natural gas (CNG) and liquefied petroleum gas (LPG) for transportation and household use, respectively.

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Leaders of the NLC and TUC are sad that, despite organised labour’s efforts to ensure industrial peace, the government seems unperturbed by the mass suffering and hardship across the country.

The October 2 agreement was “focused on addressing the massive suffering and the general harsh socioeconomic consequences of the ill-conceived and ill-executed IMF/World Bank-induced hike in the price of PMS and the devaluation of the naira. These dual policies have had, as we predicted, dire economic consequences for the masses and workers of Nigeria,” the statement by the unions said on Thursday.

Speaking further, the unions lamented that “it is regrettable that we are compelled to resort to such measures, but the persistent neglect of the welfare of citizens and Nigerian workers and the massive hardship leave us with no choice.

Effective February 9 (tomorrow), among others, the two labour unions said, “Constrained by this development and recognising the urgency of the situation and the imperative of ensuring the protection and defence of the rights and dignity of Nigerian workers and citizens, the NLC and TUC hereby issue a stern ultimatum to the Federal Government to honour their part of the understanding within 14 days from tomorrow, the 9th day of February 2024.”

The Federal Government had among other things promised the implementation of a N35,000 wage award for civil servants which however has not been paid up to date.

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The president said the decision was taken to “free up” resources that had “hitherto been pocketed by a few rich”.

Tinubu, in his first Democracy Day speech as president, said he gave effect to the removal of petrol subsidy by the Muhammadu Buhari administration in a bid to tackle endemic poverty in the country.

During his inaugural speech, the president declared that the petrol subsidy “is gone”.

Although the president’s media team had clarified that the implementation of the policy would commence later in June, post-subsidy realities are already setting in, with the Nigerian National Petroleum Company (NNPC) Limited announcing the adjustment of the pump price across its retail outlets nationwide.

The development has sparked a sharp hike in the pump price of petrol, raising concerns among Nigerians.

Speaking on the issue, Tinubu said it is necessary decision to protect the country from collapsing.

“I admit that the decision will impose extra burden on the masses of our people. I feel your pain. This is one decision we must bear to save our country from going under and take our resources away from the stranglehold of a few unpatriotic elements,” he said.

“Painfully, I have asked you, my compatriots, to sacrifice a little more for the survival of our country.

“For your trust and belief in us, I assure you that your sacrifice shall not be in vain.

“The government I lead will repay you through massive investment in transportation infrastructure, education, regular power supply, healthcare and other public utilities that will improve the quality of lives.”

‘I’LL FULFILL EVERY COMPONENT OF MY MANIFESTO’

The president also assured Nigerians that he will deliver on his ‘Renewed Hope’ agenda, while calling on elected leaders to offer “selfless service” to Nigerians.

“On this year’s Democracy Day, I enjoin us all to rededicate ourselves to strengthening this form of government of free peoples that has been our guiding light these past 24 years,” Tinubu said.

“In particular, those of us who have been privileged to be elected into public offices at various levels in both the executive and legislative arms of government must recommit ourselves to offering selfless service to the people, and delivering concrete democracy dividends in accordance with our electoral promises.

“On my part and that of my administration, I pledge anew our commitment to diligently fulfilling every component of our electoral pact with the people – the ‘Renewed Hope’ agenda.”

The president said his administration will be faithful to truth, equity and justice, adding that he will “govern with fairness, respect for the rule of law, and commitment to always uphold the dignity of all our people”.

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The Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed, disclosed this at the Public Consultative Forum on the draft federal government 2023 – 2025 Medium Term Fiscal Framework & Fiscal Strategy, in Abuja, yesterday.

According to her, the deficit underscored the fiscal challenges confronting the federal government.

Her words, “As of April 2022, FGN’s retained revenue was only N1.63 trillion, 49% of the pro rata target of N3.32 trillion,” adding, “The actual spending as of April 31st was N4.72 trillion.”

Out of the N4. 72 trillion, Ahmed explained that N1.94 trillion was spent on debt service; N1.26 trillion on Personnel cost, including Pensions; and N773.63 billion on capital expenditure.

The Minister also announced that the Nigerian National Petroleum Company Ltd which had funded the petrol subsidy until last month would henceforth leave that responsibility to the federation.

This she said would even create a greater strain on the fiscal position of the federal government, describing petrol subsidy as unsustainable.

On revenue from the new NNPC, the minister explained, “NNPC will be paying loyalties, dividends and taxes. We will work out an arrangement with NNPC on how this will be paid, and it is possible to work out an arrangement where the payment could be monthly or quarterly.”
Mrs. Ahmed lamented the low oil revenue which for the past eight months had been taken up by subsidy payments by the NNPC, with zero remittance to the Federation Account.

According to her, “the gross oil and gas federation revenue for full year 2022 was projected at N9.37 trillion; as at April 30, 2022, N1.23 trillion was realized out of the pro-rata projection of N3.12 trillion, representing a mere 39% performance.”

She added: “Despite higher oil prices, oil revenue under-performed due to significant oil production shortfalls for two main reasons: oil production shut-ins resulting from pipeline vandalism and crude oil theft; and high petrol subsidy cost due to higher landing costs of imported products.

“Actual average crude oil price is higher than the budget benchmark price of $73 per barrel. However, higher oil price is offset by lower oil output, which as of April 2022 stood at an average of 1.32 mbpd.

“NNPC attributes the fall in oil production to the high incidence of crude oil theft and pipeline vandalism.”

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Shehu, in a statement on Sunday, said President Muhammadu Buhari will be remembered as the leader who made “real contributions to economic and overall national development by eliminating the evils of corruption embedded in subsidies”.

The Buhari-led administration in March announced that the Nigerian National Petroleum Corporation (NNPC) would no longer absorb the differentials between the landing cost and retail price of petrol.

As a result of this, the retail price of petrol has been adjusted monthly to reflect the realities of the global crude oil market.

“Subsidy removal in these sectors had long been foreseen by successive administrations as game changers in search of solutions to move forward with the nation’s development. These are reforms that are necessary and overdue. Blueprint upon blueprint, timeline upon timeline had come and gone but the courage to take bold decisions was not there.”

According to Shehu, Buhari has shown the rare determination to carry out bold decisions that are driven by the desire to ensure the greatest good for the people.

“In carrying out the reforms, the president needs the support and understanding of all citizens-inclusive of the opposition parties, the labour movement and civil society groups,” the presidential aide said.

“In these challenging times, the president is pushing development goals, not politics and history will judge him in favourable terms rather than his critics in the new media and the opposition.”

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A civil rights organisation, Coalition for Probity and Integrity in Civil Service (CPICS), revealed that the Federation Accounts Allocation Committee (FAAC), had failed to meet twice in the last one week because of a major disagreement between the NNPC and the 36 State Commissioners of Finance.

The coalition said the 36 State Commissioners of Finance walked out of FAAC meeting on Monday “because of NNPC’s dubious disclosure and fraudulent posture over the subsidy payment.”

Speaking with journalists in Abuja on Tuesday, the Executive Director of CPICS, Dr. Suleiman Abubakar, said with this development, civil servants might not receive their salaries for the month of March before the Easter holiday which commences on Friday.

He said that while the All Progressives Congress (APC) Government of President Muhammadu Buhari had been deceiving Nigerians that the price of oil had declined, investigations by COICS, have proved the contrary.

To him, the Group Managing Director of NNPC, Dr. Maikanti Baru; Minister of State for Petroleum Resources, Dr. Ibe Kachikwu and the Presidency have been scamming Nigerians.

He said, “Kachikwu and Baru admitted that the cost differential of N26 per litre is being paid by government as subsidy without stating who authorised the payment. You will recall that subsidy is being paid without appropriation by the National Assembly for which the Senate Committee on Petroleum Resources (Downstream) instituted a probe

“The investigative hearing held on January 4 and even then the chairman of the committee, Senator Kabiru Marafa, curiously removed probe of the alleged subsidy payment from the agenda. After going through the report on the hearing, as submitted by the Marafa-led committee, the senators discovered that the report was silent on the alleged illegal subsidy payment.

“As we speak, the FAAC meeting experienced another stalemate because the State Commissioners of Finance rejected and walked out of the meeting arising from discrepancies in the sharing of federally collected revenue among the three tiers of government occasioned by NNPC’s dubious disclosure and fraudulent posture over the subsidy payment.”

According to him, this would be the second time in five months that the NNPC had failed to make its return into the federation account.

He said, “The FAAC meeting was postponed last week because the Nigerian National Petroleum Corporation was yet to remit the revenue for the month into the federation account.

“The rescheduled meeting for Monday did not hold because the 39 Commissioners of Finance were not happy with the dubious disclosures from NNPC over subsidy payment that they walked out of the FAAC meeting. There was no possibility of another meeting taking place before the end of this week.

“Apart from Lagos State, there is hardly any other state in Nigeria that can survive even for one month without the federal allocation. The FAAC meeting for March did not hold because NNPC is yet to remit the revenue accruing to the federal, states and local governments into the federation account.

“The members of FAAC were in Abuja last week for the meeting but were informed that it had been postponed because there was no money to share. The implication is that virtually all the states will be unable to pay workers salary for this month till after the Easter holiday.

“In 2017, the delay by the NNPC to make its monthly remittance to the federal coffers resulted in workers in some states receiving their November salary about a week to Christmas.”

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Saraki said the problem had continued in spite of efforts to sanitise the oil industry.

Saraki, who was represented by the Senate leader, Ahmed Lawal, at a public hearing on the re-introduction of subsidy being conducted by the Senate Committee on Petroleum Resources (Downstream), expressed displeasure at what he described as secret and opaque re-introduction of subsidy in the prices of Premium Motor Spirit (PMS) without any budget approval by the National Assembly.

The Senate President regretted that “government has not done what we need to do to nip this problem in the bud.”He said payments amounting to some N10 trillion were hijacked to favour few individuals. “Findings have brought to light the fact that our downstream oil and gas industry needs critical reforms”, he said.

Saraki further stated that it had been exposed that “in spite of the stoppage of the fuel subsidy regime, and non-appropriation of funds for the scheme due to the fraud and maladministration going on in the scheme, fuel subsidy payments continue to be maid illegally from our commonwealth to a few quietly in order to dodge scrutiny and avoid exposure.”

Insisting that the Senate would not rest until all perpetrators of the fraud particularly those in high public offices were exposed, the Senate president stated: “But this 8th Senate is here to expose all corruption in the system irrespective of how highly placed those involved are. This unconstitutional and illegal practice must be addressed and we are not going to rest until it is fully addressed.”

Saraki charged the committee to “get to the bottom of this issue and proffer long-lasting solutions to this racketeering in the fuel market that leaves the Nigerian people poorer every year.”

Other questions the committee must seek answers to, according to the Senate president, are “the actual quantity of fuel the Nigerian market consumes; the underlining reasons why the market is struggling to operate without government intervention; and the process and all those involved in signing out unbudgeted funds outside the budget passed by the National Assembly.”

Meanwhile, the NNPC has claimed that the Nigerian Federation was indebted to the corporation to the tune of N170.6 billion outstanding subsidy payments due from January 2006 to December, 2015.

Leading a team of top management of the NNPC to the ongoing investigative hearing on N5 trillion subsidy payments from 2006 to 2016, the Group Managing Director of the Corporation, Dr. Maikanti Baru, said the figure was arrived at after the deduction of N4.950.80 trillion received as payments from theN5.121.40 trillion approved subsidy claims of the corporation from January 2006 to December 2015.

Providing details of the accruals, the Chief Financial Officer of the corporation, Mr. Isiaka AbdulRazaq, traced the advent of the subsidy regime to October, 2003 when NNPC was directed by government to commence the purchase of domestic crude oil at international market price without a corresponding liberalisation of the regulated price of petroleum products.

He explained that under the subsidy regime, NNPC and other suppliers of refined petroleum products were entitled to file subsidy claims to the Petroleum Products Pricing Regulatory Agency (PPPRA).AbdulRazaq, however, noted that unlike other oil marketers, NNPC did not receive cash payment for subsidy claims as its subsidy claims were deducted out of cost payment to the federation account after due certification by PPPRA.

“In summary, NNPC submits that the amount of over N5.1 Trillion was duly approved by PPPRA as subsidy claims for NNPC. Out of this sum NNPC is still being owed N170.6 billion,’’ the NNPC CFO said.

The corporation called on the Senate Downstream Committee to assist in ensuring that the outstanding debt was settled to enable the NNPC to effectively achieve its obligation as the supplier of last resort to the downstream sector.

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