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Oyedele: Despite Clamour for Local Refining, Operational Inefficiencies May Make Nigeria’s Petrol Most Expensive Globally

The Chairman of the Presidential Committee on Tax Policy and Fiscal Reforms, Mr. Taiwo Oyedele, has said the resuscitation of the country’s ailing refineries may not deliver petrol at cheaper costs to Nigerians or alleviate the current economic hardship resulting from the recent removal of subsidy.

He said even if crude oil was refined in the country, the operational inefficiencies often associated with the management of the refineries would make Nigeria’s petrol the most expensive in the world.

Oyedele spoke at the Platform NG 2023 event in Lagos on Monday.

He said unless effectively addressed, inefficiency in the operation of the refineries could make Nigerians change their minds towards having functional refineries for local refining.

Citing National Assembly sources, he said the country had spent over N10 trillion to maintain the moribund refineries without producing anything.

Oyedele said, “Nigerians who say if only our refineries are working, they would be fine; nothing can be further from the truth than that.

“In fact, Nigerians should come together and say please make sure that our refineries don’t work. We should sell them.

“Maybe you have not been following this story – the National Assembly said we have spent over N10 trillion maintaining our refineries even when they have not produced anything.”

He added, “The time when they were producing, the GMD of NNPC at the time, who is now the CEO of NNPC Limited, said and I quote, ‘We have to shut down the ones that we’re producing because the two crude of $100 and produced refined product of $97’.

“And I have not added the overhead. My point is if Nigerian refineries produce crude oil, unless we deal with our inefficiency, one litre of petrol will be the most expensive in the world. You would have succeeded in replacing the subsidy at the pump with the subsidy at the refineries.”

The presidential committee chairman also said the removal of fuel subsidy had been a painful sacrifice that Nigerians have had to make as life has become impossible.

He said though the policy was necessary, the government needed to, “react and respond in a way that is robust enough so we can take some of that pain off our people.”

He insisted that, “every single naira we save” from subsidies should be “spent on the people 100 per cent”.

He argued that rather than target the upper-class, government’s interventions should focus on the lower middle-class particularly the vulcanisers, mechanics, and apprentices among others – who have been hard-hit by government’s policies and unable to support their families at this critical time.

Oyedele said interventions should be directed to areas where they could make the most impact on the vulnerable people.

He said quality data mining was particularly key to achieving positive outcomes.

James Emejo in Abuja

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