I have taken very keen interest in watching and reading the public debates by the Nigerian Senate and the public on the rationale behind the planned removal of fuel subsidy by the Federal Government. I am particularly amused by the questions and answers sessions at the Senate where some of our ministers and their departmental functionaries were practically grilled about the issue under review. We heard how an audit report on fuel matter was still gathering dust on the shelf of the Finance Ministry and the insistence of the Senate to see the report! Public confidence in our government is fast declining with the facts coming out.The questions and answers were quite logical and reasonable to a very great extent. There have been justifications and counter-arguments over the removal of fuel subsidy! However, there are some pertinent questions which as a Nigerian citizen I will like to ask the ministers of Finance and Petroleum Resources together with the Group Managing Director of the Nigerian National Petroleum Corporation and the Executive Secretary of the Petroleum Products Pricing and Regulatory Agency. These questions and observations are as follows:First, from which of the OPEC countries or foreign companies/refineries do the numerous importers (about 100 oil importers including the NNPC and construction companies) buy the refined petroleum products and at what price per litre'Two, does Nigerian crude oil form part of the contents of refined products that are being imported, and resold to us, or those countries just see Nigeria as a growing market to which they can sell their own surplus products despite our being an oil-rich country' Is it not round-tripping'Three, if Nigerian crude is being swapped with the refined products, what is the estimated cost-value of the crude oil per litre as against the cost of the refined product' Is the cost of refining our crude oil per litre higher than the average cost of the natural crude' Are we not acting as a prodigal country if we have to spend more to get our natural resources for domestic use'Four, what is the exploration cost of Nigerian crude oil per barrel (about 159 litres) and how much is it sold or exported to buyers on a daily basis' How much of the proceeds are deducted before being paid into the federation account and where do these proceeds go and for what purpose'Five, if we swap the Nigerian crude, which is not bought, is the cost of getting refined products higher and how much is this' Are there any benefits that Nigeria derives maximally as the 6th largest producer of petroleum resources in view of our near-total dependence on oil importation'Six, if according to the Minister of Petroleum and GMD NNPC, we have strategic reserves for about 51 or so days, assuming there is no importation, what is the total quantity of petroleum products that our local refineries can produce daily'Seven, if our local refineries are capable of producing daily about 20 per cent of local consumption, why couldnt the Federal Government in the last 12 years improve the capacity utilisation of these four refineries, so that the 20 per cent daily production, multiplied by 51 days would be able to reduce the quantum of products being imported' It is logical to say, if Nigerians need an estimated 40 million litres per day, and our refineries can produce just 8 million litres, or at worst, 10 per cent being four million litres per day; if we multiply four million litres per day from local refineries by 50 days, we shall have about 200 million litres. About 1.46 billion litre per year, from local refineries!In essence, as the refineries produce these four million litres daily as supplements, the strategic reserves will not be depleted and we will require lesser amount of imported fuel.And if at all there is subsidy, as the government claims, the amount being spent should reduce. Simple arithmetic! But our ministers and functionaries at the NNPC and PPPRA are telling the Senate and Nigerians that over N1.3tn is being paid as yearly subsidy, excluding the cost-quantity of products from the four refineries! Yet, despite the marginal production from our refineries, the same amount of subsidies is allegedly being paid to the oil companies importing fuel into the country! How do these oil importers source their products and how are we sure that they are not behind the poor condition of the refineries in Nigeria or the vandalising of pipelines so that Nigeria will depend on oil importation forever'Eight, is there any due diligence conducted (as required by public procurement regulations) during negotiation between Nigerian oil importers and foreign suppliers to determine the necessity of subsidy' If as alleged, the cost of imported petroleum product per litre is above N65 pump price, say N145, it means the Federal Government is subsidising the price with N80. It means the landing cost of fuel per litre is N145 or more. Are we saying that the countries where the oil merchants buy from have more or better petroleum products than Nigeria' How much is a litre of petrol in the countries where these oil companies import the products from' Why can Nigerian government since 1999 (12 years a piece) build additional refineries that will sustain local consumption, since we have the same group of functionaries in vicious recycle'Nine, how much does Nigeria make daily from its sales of petroleum products and what quantity of these are refined locally and through swaps' How many years will it take to build a modern refinery when we hear that smaller refineries can be built to refine what we can produce locally within 24 months' The fuel subsidy constitutes same old stories during former President Obasanjos locust administration, that warranted his hiking fuel prices more than five times and his establishment of PPPRA, which has now become a drain pipe of oil resources! We hear that construction companies are among oil importers in Nigeria!Lastly, which depots do the subsidy-earning oil companies use to stock the products they claim to import into Nigeria' Do fuel tankers load from the sea vessels or PPMC link pipelines to ships of companies with no storage facilities or tank farms' Which units of the Navy, Customs, Standards Organisation of Nigeria, NNPC etc verify the freight, storage and haulage to be sure that the exact quantity of fuel paid for is supplied' Are we sure the vessels contain imported fuel as they claim to have brought into Nigeria and not neighbouring countries' Are we sure these companies ever import fuel at all; or they just fill papers and get paid'- Rotimi, a HR Development Consultant & Certified Management Trainer, wrote in from Marina, Lagos Nigeria.
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