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From Uche Usim, Abuja
The Minister of State Petroleum Resources, Mr Timipre Sylva, on Monday, said that issues around petrol subsidy payment will be gone forever once President Muhammadu Buhari assents to the Petroleum Industry Bill (PIB) recently passed by the National Assembly.
Sylva made the disclosure in Abuja while launching a book titled “Nigeria and OPEC; 50 Years of Partnership, 1971-2021”.
According to him, resting petrol subsidy is in the best interest of Nigeria, especially as the PIB has no provision for subsidy.
Industry records reveal that the federal government spent N10.7 trillion on fuel subsidies in the last 10 years, including 750 billion naira in 2019.
In December 2020, the Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Mr Mele Kolo Kyari, disclosed that from 2016 to 2019, the Federal Government had spent over N3 trillion subsidising the pump price of petroleum products, particularly petrol, insisting that the subsidy regime did not benefit the masses that the President is passionate about.
Sylva said: ‘This (subsidy removal) is desirable for the interest and growth of Nigeria. Of course, everybody will have their perspectives, but from where I sit I believe that subsidy removal is the best thing for Nigeria, not just the industry.
‘So far the discussions with stakeholders are still ongoing. But I will also bring it to your attention that today when the President assents to the PIB, subsidy will become a matter of law because it is already in the PIB that petroleum products will be sold at market-determined prices.’
Sylva added: ‘The removal of subsidy has the potential of unlocking a lot more funds for deployment to development. Unfortunately, what we are doing by way of subsidy is like cutting our nose to spite our face.’
He further noted that the government would begin the rehabilitation of the Warri and Kaduna refineries soon in order to increase domestic refining of petrol and to cushion the impact of subsidy removal.
Sylva revealed that the OPEC quota given to Nigeria for crude oil production in June 2021 was 1.554 million barrels per day and that the quota system had helped in balancing oil prices globally.
On the inability of OPEC to reach a consensus at its recent meeting, Sylva said this was because one of the member nations of the organisation did not agree to what others had resolved.
He stated that this, however, did not imply that there was a crack in OPEC as regards crude oil cuts or other matters, adding that every country in the organisation must agree to an issue before such matter would be endorsed by OPEC.
The petroleum minister observed that the inability to agree among OPEC members had not significantly impacted crude oil prices, stressing that the issue would be resolved by members soon.
Sylva added that the decision by Nigeria to become a member of OPEC has enhanced the development of the oil industry in the country, as it enabled the country to influence the growth and contribute to the survival of the industry globally.
‘It placed the country among the comity of nations, engaged in the noble duty of stabilising the oil market for the benefit of all producers, consumers and investors alike.
‘The relationship between Nigeria and OPEC, without doubt, has been of mutual benefits to both parties. On the other hand, Nigeria has also contributed enormously to the survival of OPEC through turbulent times, by lending full support to the efforts of the organisation to balance and stabilise the oil market.
