We say NO to subsidy removal.
Anything that will jerk up the current price of the pump price of petrol will not be acceptable.

First the government should fix our refineries, when that is done subsidy will naturally go

Ofunaofu:
We say NO to subsidy removal.
Anything that will jerk up the current price of the pump price of petrol will not be acceptable.

First the government should fix our refineries, when that is done subsidy will naturally go

2 refineries are being fixed, plus five private refineries that can refine petrol are coming up, Dangote included. BUA refinery refines everything but petrol.

Also there are 20 other active refinery licences

Keep the subsidy and all the refineries would go broke selling fuel at a loss, and that means they all break down , meaning we are.back to square one.

Which is how the original 4 NNPC refineries broke down.

backbencher:


2 refineries are being fixed, plus five private refineries that can refine petrol are coming up, Dangote included. BUA refinery refines everything but petrol.

Also there are 20 other active refinery licences

Keep the subsidy and all the refineries would go broke selling fuel at a loss, and that means they all break down , meaning we are.back to square one.

Which is how the original 4 NNPC refineries broke down.

They have been fixing the refinery since infinity.

Upcoming private refineries?

Why not wait till they are active before removing subsidy?

Saying that NNPC refineries broke down because of subsidy is a big fat lie.

Leverage2021:
This man speak from both sides of the mouth

How ?

Leverage2021:
I don't

He is neither here nor there, reminds me of his numerous religious bigtry epistles where he claims Yoruba Muslims are been marginalised by Yoruba Christians

Are you commenting on the said publication or the current article ?

jmoore:

They have been fixing the refinery since infinity.

Upcoming private refineries?

Why not wait till they are active before removing subsidy?

Saying that NNPC refineries broke down because of subsidy is a big fat lie.

1.Subsides means that fuel is sold below what it costs to make.

2.The subsidy paid is in theory supposed to cover the difference between the cost price of fuel and the subsidised price.

3.In practice, because the cost price of fuel...the price it costs to make one liter of fuel...keeps rising...the amount spent on subsidising that one liter must needs rise.

4.This is often times impossible because the money for the subsidy comes from oil revenues

5.Oil revenues...ie revenues from crude...are never stable. It can be as high as $120 (2012) and as low as $30 (2016 and last year)...so the amount needed to spend on subsides...falls.

6.As a result of there not being a true profit...there isn't money to repair and upgrade and maintain refinereis. In addtion sabotage on the refineries happen because NNPC workers don't earn money from the refinery revenue...they are also paid from the crude oil revenue...like most civil servants.

Let's keep it simple...refinereis are in a mess because 1) government in order to reduce the cost of production skimped on reparing and renovating the refineries...from the early 1990's.....government stopped TAM. By 2011, we were producing 6 million liters of fuel a day from a capacity of 48 million. 2) they haven't been allowed to run at a profit.


Venezuela is in the same strait as we are

1.They sell fuel below N40 per liter

2.Their cost of producing fuel is very high (unlike Nigerian crude, Venezuelan crude has a high amount of sulphur...which adds to refining costs)

3.But because they sell fuel below the production price , the result is that they have bad refineries, and fuel is smugglled over the border to neighbouring countries...to the tune of costing their government 18 billion dollars annually.And their refinereis are operating below capacity.(their largest refinery is operating at around one ninth of its peak right now.)


Based on the above...I respectfully disagree with your assertion that I am lying by saying that subsides have caused our refinereis to run down.

If you owned a company making soft drinks, at the cost of N100 a bottle, and government comes in and forces you to sell the drinks at N20 a bottle to help the poor, and pays a subsidy of N30 a bottle, meaning you lose N50 for every bottle sold....your company will go bust in a few years.

Whereas if you were allowed to set your price, and you sold your drinks at N150 a bottle, making back your cost of production, and eanring a profit of N50 a bottle, which can be reinvested in the business, and provide funds for expansion, salary increases, etc etc....

That's the story of our oil industry, and why our refineries went bust.