FUEL SUBSIDY REMOVAL AND THE MADNESS OF MAINTAINING REFINERIES WITH AN AMOUNT THAT WILL BUILD 4 NEW ONES

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Umar Saad Hassan

By Umar Sa’ad Hassan

Removal of fuel subsidy has become the Buhari administration’s way of announcing an impending increase in fuel price.Before coming into office,his official position regarding subsidy was made categorically clear when he said-“Whoever says he is subsidizing fuel is a fraud“.Buhari himself is calling Buhari a fraud.

When the news was all over the place days ago that there would be a N5,000 transport allowance for the poorest Nigerians next year; the same class of Nigerians that were promised the same amount every month by this same administration, it was obvious we were looking at a huge ‘subsidy removal’.The figure being quoted currently is N340-N500 per litre which means even in the best case scenario,we are looking at an above 100% increase in ‘subsidy removal’.

One need not be a petroleum expert to know the easiest way to drive down fuel price is to refine all our oil at home and one of the main promises the Buhari administration made when it came into office was to not only have our refineries up and running in no time but to also build new ones.A proposed $2bn refinery in the President’s home state of Katsina rang out loud.While all of the country’s 4 refineries are as comatose as they have been for years,the NNPC told Nigerians in June 2020 that a whopping sum of N1.47trn had been spent on ‘revamping and maintaining’ the refineries in 5 years.Refineries that don’t actually refine oil.

That figure had increased by about N800bn by March this year when Buhari approved $1.5bn for the ‘rehabilitation’ of the Port Harcourt refinery.The Dangote refinery will cost $19bn with a refining capacity of 650k barrels per day that surpasses the combined 445k barrels per day capacity of all our refineries by 205k barrels.A thorough break down of what has been spent on our refineries viź-a-viź their operational capacities will show very clearly that $26.5bn will comfortably build us 4 new refineries at the very least.Yes 4.As a matter of fact,Buhari’s proposed Katsina refinery project is 150,000 barrels per day (more than the existing Kaduna Refinery’s 110,000 barrels per day capacity) and has a total cost of $2bn.Also note that this sum covers the purchase of pipelines that will link the refinery  to Niger Republic as well.

Buhari will not tackle this problem both as President and Minister of Petroleum because he doesn’t want the madness to end.While he is borrowing endlessly to fund ‘maintenance’, the NNPC is telling us on the other hand it will borrow to buy into Dangote’s refinery to further lend credence to the theory that our refinery problem will not end because there are people at its highest levels and their families that have invested in Dangote’s project.What is more?.Dangote will sell back refined oil to us at the international market rate and not at a suitable price.

With the maintenance culture of Nigeria in mind and the uncertainty that other administrations would be as committed,a well meaning government would have prioritized the privatization of these refineries a very long time ago.It would only look to give the ones on ground a face lift with a view to enhancing their value and placing it in a good bargaining position with investors.

Instead of functional refineries to make the lives of Nigerians easier,the poor man is now being promised N5,000 for transport amidst a satanic increase in fuel price

.A N5,000 disbursement he has no guarantee will go beyond the first few months at the very best while President Buhari keeps borrowing to do all he does that only he sees and ‘maintain’ refineries.Buhari appears hell bent on not only destroying this country but also on bringing untold pain and suffering to its people.When they fashion out a viable means of survival like cryptocurrency trading,he shuts it down.When doctors interview for foreign jobs abroad,the DSS is sent to the venue to disrupt the process.

Our main source of revenue; crude oil has doubled since the global lock down but our finances appear to be far worse of.Borrowing trillions of naira abroad to embezzle under the guise of refinery repairs and such other schemes is the reason why Nigeria may never be the same again after Buhari is done.Previous governments may have looted our resources too but they were never this inconsiderate to the plight of Nigerians.No one borrowed as much as N30trn and no one is likely to either pay thugs to disrupt protests against fuel price and charge the protesters for their crimes or get policemen and soldiers to shoot them outright.

Money that will build 4 new refineries from the ground up is being used to rehabilitate old ones while this government is teasing its third and most crushing fuel price increase since it came into power.God save Nigeria.

Umar Sa’ad Hassan is based in Kano
Twitter-@Alaye_100Email-uhassan077@gmail.com