RED Alert: Increase local refining capacity before deregulation, PENGASSAN tells Buhari print
The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) has called on President Muhamadu Buhari to increase local refining capacity before embarking on any deregulation process.
The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) has called on President Muhamadu Buhari to increase local refining capacity before embarking on any deregulation process.
This was contained in a statement on Tuesday by PENGASSAN National Public Relations Officer, Mr Emmanuel Ojugbana.
The union called on the president to ensure that the focus of
deregulation policy was based on local production rather than
importation.
It said that if local refining was not increased to meet local demand
for petroleum products, especially the premium motor spirit (petrol),
removing subsidy on petroleum products would bring more hardship on
Nigeria.
It stated that removing subsidy while the country depended on
importation of refined products would make prices of refined products to
be out of the reach of the masses and would cause inflation.
It said that importation of refined petroleum products was a major drain
on the nation’s revenue, adding that it created jobs for the refining
nations in spite of the high unemployment rate confronting Nigeria.
“Importation of refined petroleum products is also putting the Naira
under undue pressure and creating social problems for the economy.
This is unacceptable to PENGASSAN.
“Abrupt removal of fuel subsidy will create chaos that may ground the economy.
“PENGASSAN calls for well-coordinated measures with timeline to achieve
self-sufficiency in local refining as a means of proffering acceptable
steps to end fuel subsidy.
“This should be combined with such other measures for effective
optimisation of gas, especially for domestic, industrial, electricity
and automotive energy. Such will create other affordable and friendly
sources for energy needs,” it stated.
It called on the government to declare a state of emergency in the downstream oil and gas sector.
It also urged the government to convene an all-stakeholders forum to
come up with concrete and sustainable steps with reliable timeline for
achieving demand-supply equilibrium through local refining.
It stated that the strategy must be to guarantee a total stoppage of both petroleum products importation and fuel subsidy.
It said Nigerians expect that relying on the resources that the nation
was endowed with, the country should be able to provide refined products
at reasonable and affordable prices to the populace,
It stated that this could have been possible if local refining capacities were enhanced.
It explained that both the government and industry operators had always
yearned to promote competition and efficiency but failed to assure on
how to enhance local refining capacity to contain local demand.
“Government is thus persistently confronted with import parity pricing
and the burden of subsidising the imported fuel instead of locally
refined products.
“As an important stakeholder in the sector, we oppose the petroleum
products importation regime, which is rent seeking and indeed a drain
device that is inimical to our economic and social empowerment.
“It is affecting our self-dependence and means of job creation. Thus, we
maintain our unwavering belief in local refining,” it stated.
It stated that PENGASSAN strongly subscribed to the retention of the
state-owned refineries in the best interest of the Nigerian nation and
for economic security.
It stated that this was in keeping with OPEC’s principle that member
countries should hold good grip of the commanding height of their
economy.
“PENGASSAN maintains strong objection to the privatisation of
state-owned refineries as the OPEC principle is being cautiously guided
by other OPEC member countries,” it stated.