Fuel subsidy: Integrated Oil & Gas vow to stop; gets licence for refine crude oil

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Former Minister of Interior, Capt. Emmanuel Ihenacho

Benjamin Ameh
The Integrated Oil and Gas Limited have been granted an approval by the federal government to build a private modular refinery within Lagos area.

Speaking at the ongoing ninth Oil Trading and Logistics (OTL) conference with theme: “Fuelling Economic Growth Through Petroleum Policy And Infrastructure: The Downstream Agenda” in Lagos, the operators unanimously agreed that the potentials in the downstream could only be unlocked in a deregulated environment.

 

Addressing the conference on Tuesday, a former Minister of Interior and Chairman of Integrated Oil and Gas Limited, Capt. Emmanuel Ihenacho, said there was an urgent need for the restructuring of the downstream sector.

 

Capt who chairs other business said, “One of the key issues today is whether or not we will continue to regulate the prices. Fuel subsidy is good if only it can deliver cheap energy to the poor people for whom it is targeted. But how many poor people drive into the filling station and buy subsidy fuel? The answer is none because it is only the rich that drive into filling stations.”

 

Ihenacho who did not hide his feeling disclosed that integrated oil and gas company has been granted licence to build 20,000 barrels per day modular refinery in Lagos adding that the refinery would be competitive as the transport cost of shipping crude oil abroad and bringing back the petroleum products would be eliminated.

He further said that the modular refinery types will surely come alive soon.

The Group Managing Director of NNPC’s representative at the event, Mrs. Aisha Katagun said that the government would streamline subsidy management and redirect it to benefit the poor, adding that the NNPC has a zero tolerance for corruption as the corporation is being re-position for better performance.

OTLRain

Also speaking, the Managing Director of Rainoil Limited, Mr. Gabriel Ogbechie, pointed out that regulation has created challenges of funding, payment of subsidy, infrastructure and foreign exchange issues for the operators and therefore makes operations difficult.

 

While, Managing Director of Mobil Oil Nigeria Plc, Mr. Tunji Oyebanji insisted that the giant in the downstream could only be unleashed in a deregulated and competitive environment.

 

“That is what is holding us back. Nigerian cannot be an island. The world is moving in a particular direction where the market is deregulated and competitive. The poor people we think we are protecting with subsidy are actually being shortchanged because of the huge loss to the economy,” he explained.

 

He said the only reason why Nigeria continued to move in a different direction from the rest of the world was because the country has oil to finance business in such manner.

 

Executive Vice-Chairman of Technoil Limited, Mrs. Nkechi Obi thanked the organisers for the success of the yearly conference while urged national assembly to pass the must waited for, petroleum industry bills (PIBs).

 

A former President of African Refiners Association and retired NNPC’s Group Executive Director in charge of Refining and Petrochemicals, Mr. Tony Ogbuigwe advised the government that the current low oil price regime is the best time to deregulate.

 

Emeka Akabogu, Chairman of OTL Conference, disclosed that the OTL Week was focused essentially on aggregating the value chain for downstream oil and gas that improve on economy of the country.

 

From OTL conference, all operators in the downstream sector of the oil and gas industry were restated their opposition to the regulation of the sector by the federal government saying government should focus on making policy that attracts more private operators into the sector.


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