The Senate, yesterday, urged its Petroleum Committee on downstream and upstream sectors of the oil industry, when constituted, to invite the Minister of Petroleum and the Managing Director of Nigerian National Petroleum Corporation (NNPC), Mele Kolo Kyari, to brief it on the status of existing refineries, including the status of newly licensed modular refineries in the country.
The decision followed a motion by Rose Oko, tagged: Existing Petroleum Subsidy: Ensuring Self -Sufficiency in Domestic Refining of Petroleum Products.
The motion had 42 other senators as sponsors.
In his contribution, Patrick Ifeanyi Ubah, called on the Executive arm to withdraw $1 billion from the Excess Crude Account (ECA) and give it to the Nigerian investors as collateral for building modular refineries.
He said if 10 modular refineries are established, it would automatically put an end to the fuel subsidy regime and also earn more income for the government.
Speaking on the motion, Oko said although Nigeria produces 1.7 million barrels of crude oil per day, its moribund refineries had very little refining capacity.
She said the nation imports roughly 90 per cent of its fuel, negating much of the benefits accruing to oil producing nations from high crude prices.
She said despite the resources expended on turn around maintenance, none of the NNPC’s four refineries currently functions up to 50 per cent of their combined capacity of 445,000 barrels per day.
She said that the objective of modular refineries is to overcome the huge capital requirement that impedes establishment and maintenance of large scale refineries. This, she said, would ensure self sufficiency in the production and supply of petroleum products.
Oko said data from the Department of Petroleum Resources (DPR) website had indicated that a total of 633,000 barrels per day refining capacity had already been lost due to the expiration of licenses of both conventional and modular refinery projects.
She said Nigeria had introduced petroleum subsidy in the 1980s as a measure to strengthen local refining industry and improve product affordability and domestic consumption. She, however, said successive adminstrations had failed to make Nigeria self-sufficient in domestic production.
The senator said despite the dire need to exit petroleum importation and subsidy, there was neither a comprehensive plan to ensue its actualisation.
She said there was no form of technical and financial aid for refinery licence holders to ensure the refineries become operational. In his remark, the President of the Senate, Ahmad Lawan, said the motion was designed to ensure that the 43 licensed modular refineries become operational.
He said there is need to support them to become active. He said the senate must make it a duty to ensure the establishment of the modular refineries. He said the Petroleum Industry Bill (PIB) was also key to the optimal utilisation of the refineries and emergence of the modular refineries.
Source: The Sun
