I just pray God will touch the hearts of our leaders to have human compassion. With the vast resources in this nation,I wonder while we so much dwell on fuel alone.I don't want to sound pessimistic,removal or no removal of oil subsidy is not the solution to our problems.We are too hypocritical in this nation.

Let's face fact how much are our leaders earning in a month? Let them cut down their salaries and so called allowances and let such be invested in the nation. Someone said the FG cannot build refineries.For God's sake let us be real.They can build as many as possible if they WILL to.

As far as I am concerned there will not be a great change in their new agenda which is going to compound the woes of Nigerians the more.

I will like to commend GEJ for backing down on the subsidy removal on the other hand i hope the consultation does not include bribing or cajoling the NLC and civil society groups to accept that demonic policy.

I think i understand Al harem and jason's confusion ur confusion was orchestrated by Ruben Abiati and GEJ by proxy.

How many of you have researched on this subsidy issue before taking a stand?

There are more misnomers than facts surrounding this subsidy bruohaha.
First, the Govt said the economy will collapse, this one is ridiculous
Secondly, the Govt said oil importers are a 'cabal' this one threw me off my seat.

Fellow Nigerians, there are no cabals, in 2009 the scarcity of petroleum products became intense and the Govt admitted that Nnpc through its subsidiary PPMC has failed Nigerians by their inability to meet up with the supply of pet. Products and that phenomenum gave rise to licensing of some people to 'assist' the Nnpc in doing their job for which they are paid for.

Please dont forget that hitherto, Nnpc has been doing the importation and refining themselves before corruption eroded their common sense.

These importers went abroad and came back with a price Nnpc is already aware of comprising of logistics,storage and administrative costs, these were quantified before they arrived at a price.
The FG now fixed a price tag of 65naira on Pms and agreed to be reimbursing the importers the balance knowing fully well that the landing cost is higher than the stipulated price
To my greatest chagrin, the odechukwu administration woke up and termed them 'cabals' who are fleecing the nation.
Assuming ruben Abiati goes to abroad to buy a TM lewis underwear for 1k and decides to sell it 1.5k adding purchase price plus logistics plus profit and the Govt tells him to sell at 900 naira, wont he ask for the 600naira balance? when the incompetent NNPC agrees to reimburse him, then he has become a cabal stealing from the GOvt?
Are we this docile? If Nnpc lived upto their responsibility, we wont have need for the importers in the first place.
There is no doubt that the subsidy regime is met with corrupt practises, is it not the responsibility of the govt to clamp down on those malfeaseance?
The only solution that came to the minds of this disgruntled PDP administration is to remove subsidy intoto not minding its inflationary consequencies.
This is the most silly approach any human being with brain if they have one can summon.

Thirdly,
Odechukwu insulted the intelligence of Nigerians telling us that we dont benefit from this subsidy except for the importers and he had the unbriddled temerity to be advertising it on NTA saying the rich are getting richer.
This people are demons. When Ruben abiati's mother goes to the market to buy vegetable at a price, does he not know that the seller included cost of transportation to that price?
So when the transporter buys PMS @ 65naira and fixes his price based on that he said his mother did not benefit from the subsidy that guaranteed the price in the first place?

It is either Ruben Abiati and his employers are drunks or they think that Nigerians are m0rons.

I feel sorry for people that think that competition will crash the deregulated price invariably juxtaposing it with GSM.
Do you know that the price of crude being the raw material for refined pet. Products is sold at the same price in the whole world?
If you agree to this, then, even if you deregulate and license 5million importers the product will still be expensive because crude itself is expensive. You will still need to subsidize it to 65naira. Exactly why deregulation of diesel in part did not work.
The only reason you have not bought diesel @ 200naira is because there are so many illegal refineries who bunker crude, settle JTF and refine diesel at a lower price.
This people still pose a great threat to the importers who buy at a higher price that is why you get diesel @ 140naira elsewhere but in the delta i buy as low as 110naira.
At this verge you will not over rule the fact that these unscruplous elements contribute to the availability of diesel, if you are in doubt, anywhere you see cheap diesel, ask the dealer the source of his consignment
If he is honest he will tell you the truth, when i was told, i took an hr 20mins boat ride to kola a remote village in the delta and i saw the local refinery myself. I will post the pictures later.
Conduct a chemical test on those cheap diesel if you are not convinced and you will realise a lot of additives are missing.
Sounds incredible but that is the reality on ground.
You now know why many importers in the delta hardly have diesel.

I still feel sorry for those who think the Govt should build more refineries, that will not solve the problem because there is no cheap crude to supply these refineries.

The oil production of Nigeria stands at 2.37 million barrels of crude daily. nigeria get this crude in a JV (joint venture) with IOC's (international oil companies) and the nigeria's cut stand btw 55% to 60% of the lot, if we go by 60% then
That gives a total of 1.4m barells daily.
If we average the crude price from 2009 till date, the price falls close to 100usd/bbl.
In that case, Nigeria makes 140,000,000usd daily from this JV.
Nigeria has a policy called DSO (domestic supply obligation) which mandates 250,000bbl/d of this crude to be refined and consumed locally,
In monetary terms, the Nigerian govt is giving us 25,000,000usd worth of crude to refine.
Our three refineries at optimum capacity utilizes 450,000bbl/d which gives 45,000,000usd in monetary terms in other words, the price of raw material in this case, crude, acrued to our refineries comes at 45m usd per day, if you add refining cost and profit of 6usd per day,
The total cost becomes 270,000,000usd per day.
There is no way you can refine that crude at that price and sell it 65naira/l and make profit.

Meanwhile, once we mark out that 45m usd worth of crude for our refineries (assuming they are working at optimum capacity), the govt has already lost 45m usd from their 140m usd earnings and after refining will still spend more money to subsidize it to 65naira/l
With this analogy, you will agree with me that if all our refineries are working optimally, the govt will spend 3times our present day subsidy to bring the pump price down to 65naira/l.
So, for those of you clamouring for refineries should be careful what you wish for because there is no cheap crude for you to refine.

I have argued abinitio that the sales of other derivatives of crude will bring down the cost of most sort PMS,DPK etc but after doing some feasibility studies, i realised i was dead wrong.
So what is the way forward?

I further argued that to make cheaper crude available for our refineries, the Govt should reduce the price at which it is supplied unfortunately, the senate mandated the then GMD of Nnpc that the DSO must be sold at international crude price.

This i believe was proposed for the following reasons:

1 the refineries are working below capacity so what the heck does Nnpc use the crude for?
2, there is a benchmark on crude price for budget implementation.

With this reasons, any existing or yet to exist refinery in Nigeria will get crude at a high price and must need subsidy to sell at 65naira/l, at this cross road, the then GMD of Nnpc decided that all crude should be exported and subsidy be paid on imported products.

Guess he was left with no choice.
At this verge, i must reiterate here that competition amongst importers will only crash the profit magin but not cost price.

Even if every Nigerian becomes an importer of pet. Prods, we cannever change the fact that crude in the intl market is already expensive before thinking of refined prod. So we must need subsidy to make profit.

Before this issue of subsidizing petroleum products can be adressed,
You must have the following at the back of your minds:

1, Nigeria pegs a benchmark on crude prices to enable it implement budget. This stands at 65 to 75usd/bbl. And this crude is sort from the JV.

2, if crude price exceed the benchmark above, Nigeria makes excess crude revenue (ECR)

3, if we make excess crude revenue, then the price of subsidy on refined products shoot up.

With the above analogy,
One can argue that the ECR be used to subsidize imported petroleum products since both are a function of each other unfortunately in Nigeria it comes with its own challenges.

By law, the constitution clearly states that all revenue acrrued to the FG be shared amongst the three tiers of Govt.
This alone makes it illegal for the FG to keep the ECR to itself for whatever reason.

This is where the wahala started, during GEJ's campaign, he astronomically increased workers salary without consulting the state Governors,

most Governors have refused to pay on the grounds that they cannot afford it. On that grounds Taraba,jigawa and some other states have a genuine case.
With the above development, the states started scramblling for funds and remembered the ECR and insisted it must be shared to enable them pay the new wage and develop infrastructures.

The FG had no choice but to capitulate

FG should gradually reduce the fuel subsidy. There is a better way to invest and channel the trillions spent on it.

Investments which will actually bring returns rather than basically going into a black hole. It is not as if the average Nigerian actually pays any tax, so FG have to tighten the belt. They should also cut down the wasteful spending on government ministries and activities and scale back on irresponsible purchases which occur every time administrations change hands.

I must say though, Nigerians should stop talking about the revolutions of Egypt and Libya etc. The average Nigerians is not riled up because of the better future they want for Nigeria like we saw with the valiant protestors of the Arab world.

This is a purely selfish motivation.

Every man is PURELY thinking of his own pocket and are confusing it with a righteous protest for the nation as a whole.

You do a great disservice to the people of the Arab nations who understood what personal SACRIFICE and a genuine cause for their nations future was, when you attempt to draw any comparison with them. The truth is, the average Nigerians stands in line along with the leaders they claim to hate, to take take take from Nigeria, and never willingly giving back.

The Nigerian citizen views Nigeria as an opportunity to plunder.

With this development, the FG is left with little or no choice.

The way forward:

In the short run:

While the FG is consulting, they must consider these options, identify and tackle the corruption prevalent in the subsidy regime. That will push down the cost of the subsidy in the first place.
Like i said in April,no matter how sincere GEJ think his administration is, he cannot make any reasonable progress in the face of corruption,

Secondly, the power projects must come upstream before removing subsidy, this will reduce the demand on pet. Products to a very great extent.

Thirdly, Nigeria must accomodate Gas export, port duties and other forms of revenue in their budget implementation policies.

Fifth, the Govt must never invest an extra kobo in our moribund refineries, by doing otherwise, the cost price of the refineries will rise to an extent that it will no longer be attractive to investors or will prolong their repayment plan.
Thereby making it very capital intensive.

Fourthly, Instead of decieving Nigerians with their cabal bullshit and deluding them that they dont benefit from this subsidy, the FG should channel that propaganda with intense lobbying to the senate,NLc and civil society organisations to stop the state governors from demanding for the ECR, this can be achieved by the FG asking the state to pay whatever increment they can afford for the workers that way the ECR will be used for subsidizing pet. Products.

In the long run:

Nigeria must seek local production capacity.
It is no longer news that Nnpc and its subsidiaries have failed woefully in meeting the needs of the Nigerian people.

Nnpc through its subsidiary Npdc and Ngc are saddled with the responsibility of the above for oil and gas production respectively, but as i write, the current production of NPDC stands at 90,000bbl/day which is a huge failure for an agency set up 23yrs ago,

The IOC's has made us believe that it will cost less than 18usd to extract 1bbl of our oil. The Management of NPDC must be reshuffled and if possible experts brought in on contract basis to improve NPDC's production

These experts must be placed on targets appraised by milestones. in ogoni land for instance, Anglo dutch has a lot of abandoned production facilities and marginal wells and others scattered all over the country, these can be bought by NPDC with the money FG want to waste on refineries to improve production,

If NPDC can extract oil at 18usd/bbl and make a little profit, with this cheap oil available, Nigeria will have no reason going to the JV. This cheap crude will attract investors to build refineries and create jobs,

A 250,000bbl/d refinery will cost a little above 5b usd, dangote alone can afford two of those only if NPDC can guarantee cheap oil. This is why no investor is comming to build refineries.

A crude price of 25usd/bbl from NPDC will guarantee pump price of less than 28naira per litre of pms from these refineries.

With this plan,By the end of this Administration, NPDC will have robust production capacity and the refineries will guarantee steady refined products.

These refineries shouldn't be operated by the Govt for any reason.

The FG will generate revenue from both ends, export of crude and export refined products and the production of NPDC must be increasing perodically.

Once the above takes effect, there wont be any need to be paying subsidy because pump price will be around 28naira/l and inflation will reduce by 40‰.

No oil exploration company is welcome in we ogoni land; they can look elsewhere if they so desire.

uncle joe why did `nt u include fuel subsidy removal in ur manifesto wen u were contesting
for presidency? i knw for sure GOD want to use u to achieve a purpose and very soon we will
no longer be in the dark about it.