SAN FRANCISCO, February 20, (THEWILL) – The Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, has declared that it was important for the country to address issues surrounding the pricing of petroleum products and gas if Nigeria must overcome the challenges in the supply of petrol, power and gas.
Kachikwu stated this on Tuesday at the ongoing Nigeria International Petroleum Summit in Abuja, saying that until the country addresses the pricing issue and repair the existing refineries or encourage private investors to build new ones, it would continue to have problems in the downstream sector.
He however, stated that in attempting to fix the right price for petrol or any other commodity in the oil and gas sector, caution must be applied to ensure that citizens were not made to suffer unduly.
“Ultimately, the greater challenge that this country would have and still has is that of pricing. Everybody wants power, available gas and freely delivered fuel with no queues, but people are not willing to make the sacrifices that are essential for these things to happen,” the Minister stated,
“Sometimes, it is a pricing issue. We have got to get to a point where we’ve got to deal with some of these issues in a manner that doesn’t hurt our people but at the same time create the level of efficiency as to remove arbitrages and patronages that are inbuilt in them.
“Refineries and local production are key. We expect a 12 to 18-month corridor of construction and hopefully, at that point, we will get our refineries back. However, if we get the refineries back by 2019, does that solve the problem? No, it doesn’t.
“You still have to deal with the pricing issues, because nobody is going to build a refinery and sell products at a loss.”
The Minister revealed that the Federal Government would be setting parameters and incentives for building of refineries.
“That is the major policy directive. There are going to be incentives for those who are doing the major practical investments in the refineries, for example. There are not dearth of opportunities in this country. I do not know of any country with the vast opportunities that Nigeria possesses,” he continued.
“If there are incentives for them to crack them here, they will do so. Ultimately, Nigeria must aim to be the refining corridor for the whole of Africa. That is becoming very critical.
“If we do all that concerning the planned investments in refineries, my position is that the business has got to change. It has got to change to taking your crude oil and being able to refine. It has got to change to be a major player in the power sector. It is got to change from oil to gas and to clean energy. We have got to look into moving incentives away from oil, back into gas and back into cleaner energy.”
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