The Federal Government has said that repairs on Kaduna and Warri refineries have been completed and both will commence refining crude oil by mid December.
The Minister of State for Petroleum Resources, Odein Ajumogobia, said this at a press briefing on Wednesday at the Presidential Villa. Mr. Ajumogobia added that the broken pipelines connecting both refineries are still being repaired and hopefully all repair works will be completed next month.
"Kaduna and Warri (refineries) have been rehabilitated and we are just trying to get crude to them," Mr. Ajumogobia said.
"The pipelines are still bad and once the pipelines are repaired and we are told that by the middle of December the work would have been through so crude will now go to Warri and Kaduna." Mr. Ajumogobia also said he will visit the refineries to assess them, adding "once the refineries are working, we will reduce our importation by about 40 per cent".
Although, he could not specify the actual amount of money spent on the importation of fuel he, however, said it cost government N45 billion every month for subsidies while the daily average consumption of petrol is put at about "18 million litres a day".
No more government refineries
When asked of the possibility of government building new refineries, Ajumogobia said, "The government can't afford it and no private investor would want to invest when he is not sure of getting returns on his investment. That is why we are pushing for the deregulation and as soon as we deregulate the market you will see new refineries and in fact you will see increased capacity.
"Just like the Liquefied Natural Gas (LNG), you will see people who will build small refineries, say for 5,000 barrels to serve their community and so on, and there will be others who will build 500,000, one million, five million refinery capacity. Why? Because they will dedicate part of it for local consumption and they will export the rest to make their money. It is only then we can now talk about bringing the price down. We can say ‘Okay we have so much crude oil and we can dedicate it to the refineries as recovery cost'."
Mr. Ajumogobia also blamed oil marketers for the queues seen in some petrol stations across the country saying, "These people think there would be imminent hike in price so they hoard the product. The Nigerian National Petroleum Corporation (NNPC) has brought the fuel and people are keeping it in their backyard. It means there is no fuel in the stations. We have supplied enough to the market and some people are hoarding it so that they can make extra money".
He added, "if we should do it now (deregulation) it means we are halving our revenue and Nigeria is relying 90 per cent on crude oil. For those who say we should just give it free, basically what we are going to do is that we are halving our budget," he said.
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