THE SIMPLE ARITHMETIC OF FUEL SUBSIDY Pt. 2

continuation of Tunde Bakare’s speech

Furthermore, in addition to its exploration activities, NNPC was given powers and operational interests by enabling legislation in refining petrochemicals, transporting products and marketing. Between 1978 and 1989, NNPC constructed refineries in Warri, Kaduna and Port Harcourt and took over the 35,000-barell Shell refinery established in Port Harcourt in 1965 and expanded it to become a two-tier refinery.

Today, the four refineries in Nigeria currently operate at 21% capacity providing 93,450 litres daily, while, on average, Nigerians use 294,000 litres of fuel per day which means that an additional 200,550 litres is imported to meet the domestic need. If you multiply that figure of 200,550 litres by the N75.00 absurdity called subsidy, Nigeria spends N15 million daily to pay for our leadership failure and pathological laziness.

The federal government has been dangling the carrot of what enormous savings they stand to make and then invest in infrastructural development, mass food production, education, health services and minimum wage. These half truths and easy answers are weapons of mass deception as the government cannot save the entirety of the sum being touted for the simple reason that 40% of total fuel consumption is by the government itself.

Fellow citizens of Nigeria, by removing the subsidy – if we ever allow this to take place – Nigerians will be made to pay for the ineptitude of their leaders and the kleptomania of government functionaries. Like other nations, some less endowed, we have the opportunity to set up our own refineries, refine our products, sell and export refined products, and make money. Instead of doing that, both NNPC and the government “explore sleaze, refine roguery and market sharp practices.” They cannot complain that they import at a high price. It is their idiotic choice and Nigerians should not be made scapegoats for their poor choices.

I have other reasons why Nigerians at home and abroad, young and old, must stand against the removal of this absurdity called subsidy, so that the government can be compelled to look inward and stop fleecing the poor people of this nation.

  1. Successive governments have failed to explain why the refineries have remained incapacitated despite humongous investments over the years on Turn Around Maintenance (TAM);
  2. At present, the four (4) refineries in Nigeria operate at 21% of their total capacity and produce 93,450 litres per day. We have not been told the cost per litre as earlier mentioned and the reason is not farfetched – the disparity between local cost of production and cost of importation will glaringly show the cost of our leaders’ negligence and incompetence. To show the lack of foresight and unpardonable haemorrhaging of our national economy, if the refineries are made to run at only 66% capacity, they would produce more than the 294,000 litres needed domestically everyday;
  3. Nigeria under irresponsible leadership prides itself as the sixth (6th) largest producer of oil while wearing the shameful badge of being one of the highest importers of petroleum products, paying as much as N1.3 trillion to sacred fat cats that are untouchable because of compromises at the highest level of government in our nation. Whereas nations more or less endowed as we are, like Libya and Venezuela, refine their own crude oil. Venezuela does not even export a drop of crude. Why does our country continue to export crude oil to countries that then refine and sell it back to us at higher prices?
  4. Why does NNPC leave its own storage facilities unused and proceed to incur additional costs from leasing third party storage facilities? The DPK tanks with a storage capacity of 18,000 cubic metres at the PPMC depots within the Mosimi area have not been used for three years, though they are in good condition. The cost of leasing third party facilities is passed to the government and entered as subsidy in the books. The owners of these third party facilities are not faceless people, they are part of the cartel siphoning the resources of our nation. They cannot do it without the collaboration of those in the corridors of power;
  5. The federal government of Nigeria does not tell the whole truth each time it trumpets and blows its propaganda machinery that the present N65.00 per litre we pay for petrol is the lowest in the world. Put side by side with the cost per litre of petrol in other oil producing nations, ours is one of the highest:

Iran sells for N58.40 per litre

Kuwait: N30.66 per litre

Qatar: N32.12 per litre

Saudi Arabia: N17.52 per litre

United Arab Emirates: N54.02 per litre

Libya: N15.95 per litre

This oil subsidy saga to me is the proverbial handwriting on the wall and this government has taken the toga of Rehoboam, the son of Solomon, to further concretise the suffering of our people in the midst of plenty. Rehoboam thought he could continue the profligacy of his father, but the people that were pushed to the wall kicked back because they could not comprehend why their nation had everything but the citizens paradoxically lacked everything.

A cursory look at this scandalous precedent in the Bible and the attendant consequence that ensued will show to the wise and discerning the end-product of taking the people you are meant to serve for granted.

The abundance the land of Israel experienced in the days of Solomon can be likened to the period of our oil boom when one of our military leaders exclaimed that Nigeria’s problem is not money, but how to spend it.

…to be continued

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