PETROAN Advocates For Privatization Of Refineries And ₦100 Billion Grant To Sustain Oil Marketers Amid Subsidy Challenges

PETROAN Advocates for Privatization of Refineries and ₦100 Billion Grant to Sustain Oil Marketers Amid Subsidy Challenges

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PETROAN Advocates for Privatization of Refineries and ₦100 Billion Grant to Sustain Oil Marketers Amid Subsidy Challenges

The Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) has urged the Federal Government to take decisive steps in addressing the challenges facing Nigeria’s oil and gas downstream sector. Chief among its recommendations are the privatization of state-owned refineries, including the Warri and Kaduna facilities, and the provision of a ₦100 billion grant to support oil marketers struggling with the ripple effects of subsidy removal.

In a statement titled PETROAN’s Retrospect of Nigeria’s Oil and Gas Downstream Sector 2024, released on Saturday, the association highlighted the urgent need for these measures to ensure operational efficiency, reduce government expenditure, and stabilize the nation’s energy market. The statement was jointly signed by PETROAN President Billy Gillis-Harry, National Secretary Adedibu Aderibigbe, and Spokesman Joseph Obele.

The Call for Refinery Privatization

PETROAN strongly advocated for the privatization of state-owned refineries, a move it described as essential for improving Nigeria’s refining capacity and curbing excessive reliance on imported petroleum products. The association emphasized that prioritizing crude oil supply to local refineries would enhance their operational efficiency and contribute significantly to the nation’s economy.

“Privatizing these refineries and ensuring they have prioritized access to crude oil will unlock the full potential of our refining sector. This strategic move will not only drive economic growth but also enhance energy security and reduce dependence on imported products,” the statement read.

Subsidy Removal and Its Impact

The removal of the fuel subsidy in May 2023 has left a profound impact on the downstream sector. Petrol prices skyrocketed from ₦170 to over ₦1,000 per litre in many parts of the country, creating widespread economic challenges. PETROAN’s leadership warned that these price surges have put immense pressure on oil marketers, with many on the brink of shutting down their businesses.

To mitigate the looming crisis, the association appealed to President Bola Tinubu for a ₦100 billion grant to support marketers. According to PETROAN, this financial aid is critical to preventing the closure of approximately 10,000 businesses and averting a wave of job losses across the sector.

Border Security and Digital Transparency

Beyond financial interventions, PETROAN called for stronger collaboration with neighboring countries to address the persistent issue of smuggling. The association proposed a robust border security framework complemented by the implementation of a digital tracking system. This system would monitor the movement of petroleum products from refineries to retail outlets, ensuring transparency and accountability within the supply chain.

“Curbing smuggling through advanced digital tracking and effective border management will significantly reduce losses and stabilize the market. Transparency is key to fostering trust and ensuring fair distribution,” PETROAN stated.

Creating a Competitive Market

PETROAN also emphasized the importance of a competitive market structure to drive innovation and ensure fair pricing. It called for the dismantling of monopolistic practices that currently stifle competition in the sector, urging the government to create a business environment that attracts new entrants.

“A competitive market will encourage innovation, prevent monopolistic dominance, and promote fair pricing, ultimately benefiting consumers and securing the future of Nigeria’s energy sector,” the statement concluded.

A Roadmap for Stability and Growth

The association’s recommendations form a comprehensive roadmap aimed at stabilizing Nigeria’s oil and gas sector while fostering long-term growth. By addressing issues such as refinery inefficiency, subsidy removal, and market monopolies, PETROAN believes the nation can achieve energy security and economic resilience.

As the sector faces mounting challenges, PETROAN’s call for strategic reforms serves as a timely reminder of the critical need for government intervention to safeguard the interests of businesses and consumers alike. Whether through privatization, financial support, or improved border management, the association’s proposals outline a clear path forward for Nigeria’s oil and gas industry.