Very Important-Please broadcast - Petroleum Marketers are fighting back by exposing some of the subsidy deals.

They say Nigeria must know that Haruna Momoh the MD of PPMC and Deziani Allison Madueke Minister for Petroleum has been demanding and pocketing N50 per litre of Kero and petrol produced by local Refineries since Jan 2011 till date. The reason they gave to marketers is that it was marketers contribution to Jonathan's election, but it has continued even after the elections.

That the govt should probe Nezor SA and Tridax SA  two companies owned by the Peroleum Minister run by her junior brother. This two companies in the last 16 month of her tenure has from nowhere become one of the few companies lifting crude oil and one of the largest beneficiary of the subsidy.


The marketers want Nigeria to probe the new list of briefcase companies now lifting crude oil because they paid minimum of $1 million to Momoh and Deziani.

I think we hv started seeing the real faces of the cabals!

Jonathan Should be Impeached. He is not meant to be a leader, with all the number of deaths being recorded on the streets due to this removal and he is still adamant and sticking to his decision, when the masses are saying NO to subsidy removal. Are we in military rule or what? Jonathan must Go!

I speak like a doctor who is trying to treat a patient over the phone!

Most of these things have a multiplier effect. Assume each unique factor I mentioned increased by say 20% each for the year. What's the total effect:

Demand Rise x Exch. Rate x Supply chain factors x Smugglng rate x Price Increase = 1.2^6 results in almost 3x of total increase.

Once again, this is an assumption. I just hope you get the basic idea.

The car excuse is simply ridiculous.

They make it seem like Naija is filled with rich people who can afford even the cheapest "fuel guzzlers"

Majority of Nigerians depend on public transportation. People are stuffed into small buses and cars which makes for even better efficiency in terms of fuel use.

Also, our road networks have been more or less the same since forever, so where are all these cars being driven? In the parking garage? Point is no matter how many cars you own, you can only drive one at a time.

About the generators? Is it our fault that our Government can't generate enough to sustain the population?

Abegi, all these excuses are sickening.

efisher:

@Dis guy, that's a valid concern too but let's point the searchlight on the power sector also.

1. Population has increased leading to direct increase in energy need.
2. Increase in "MW" most likely did not meet up with the increase in power demand.
3. More appliances, more businesses, greater awareness, more wealthy individuals etc all contribute to an increase in energy demand and ability to meet it.
4. More generators imported as mentioned earlier.

What was the percentage of population increase . You can say increase in population by 10% led to increase in fuel consumption of 500%.

Increase in power demand cause by what? what are the evidence of increase in Power demand?

More wealthier individual? are you having a laugh? when many lost their jobs either directly or indirectly to the Banking sector collapse/Sanusi tsunami?

If you bought 4 SUV, Since you cant drive 4 at the same time, your fuel consumption still remains the same as when you have 1 SUV

I've made my points, you have identified possible flaws, good and fine. Let those that have access to real data do the rest. I just love to analyse and I'm having fun.

digidamage:

Back to the main issue. WHy the hullabaloo about the fuel subsidy and the subsequent decision to remove it? simple, because it suddenly went up to N1.6trillion naira. In 2009 & 2010 it averaged N270billion, or thereabout. So why the 500% increase in a year?
First, a few facts.
[b]Between January 2011 and March 2011, FG paid an average of N22billion monthly as subsidy. At that rate, we would have paid around N264billion (which was close to the N240billion budget signed by the National Assembly). However, something happened afterwards. From April 2011, subsidy increased to over N100billion monthly and stayed that way until the end of the year. Don't forget, April was the mont of the elections. [/b]This is what we need to look into.
The funny thing, and i shudder as i think of this, is that there might be no cabal afterall. And even if they exist, they are not the ones who submitted the 2012 budget proposal to the National Assembly last December. The didn't propose a billion naira for feeding in the presidency. The didnt propose N300k for desktop computers etc.
In any case, Nigerians didn't vote for the so called CABALS. These blame-game by the Jonathan regime must stop

Everbody saw the amount of money PDP where splashing about to rig the elections. They didnt excatly hide. GEJ is part and parcel of the cabal how long has he been in elected positions?

efisher:

I speak like a doctor who is trying to treat a patient over the phone!

Most of these things have a multiplier effect. Assume each unique factor I mentioned increased by say 20% each for the year. What's the total effect:

Demand Rise x Exch. Rate x Supply chain factors x Smugglng rate x Price Increase = 1.2^6 results in almost 3x of total increase.

Once again, this is an assumption. I just hope you get the basic idea.

Did you say Demand rose by 20%? What would cause Demand to rise by 20%?

Did exchange rate rise by 20% Exchange rate as at Dec 31 2011 is 156 to a Dollar, Exchange rate as at 31 Dec 2010 was 148. That definitely wasnt even close to 10% increase.

Supply chain factors like what and what?

Why would smuggling rate increase by 20% in 1 year? care to share the reason?

Price increase in what exactly?

mainly quadrupled due to inflated false imports by cabals. they collude with custom officials, offer them irresistible tips to approve & sign deliveries of MT's of oil that was never brought into the country.

saying the number of cars brought in has increased is just a flimsy reason. although such factor is likely to increase domestic consumption, it's effect is negligible. another factor worth considering is the fact that power supply has been deplorable, thus increasing local consumption as people burn more fuel to generate power.

thanks to corrupt custom officials and NEP. PLC (NEPA).

one thing still remains valid,- this government is an irresponsible one and should not be trusted. if OBJ's government can build up foreign reserves to the tune of $33b while retaining fuel subsidy, i see no reason why they argue it's impossible to work with subsidy still intact. lets not forget that the $33b as we speak, has been squandered by this prodigal government of GEJ within barely 2 yrs. if subsidy is removed, they will generate about $8b annually. a government that has unaccountably splurged $33b in less than 2yrs, is now coming up to pull wool over our eyes by claiming they can judiciously use $8b to the benefit of the masses. this, as far as i'm concerned, is sheer casuistry (sweet talks).

they are not to be trusted. they just want to add more allowances and get more aides for them selves in the face of the current political unrest and insecurity within the country.

Dayokanu, can you read? If you can, you will see where I wrote the word "Assumption". Kindly look up the dictionary meaning.

I cannot but express my profound
gratitude and solidarity to the NLC,TUC
and other affiliate organizations.
We in the oil and gas sectors are solidly
behind you.

Let me quickly introduce ourslves, we are a
group of well meaning Nigerians in the oil
and gas upstream sector who wish our
voice to be heard in this battle to save
Nigeria.

While we negotiate with the government,
these perspectives must be adressed.

lets talk about this present day subsidy
regime, the Cbn gov has already confessed
he has evidence of round tripping , he said
he paid subsidy on 15 fake vessels
approved by customs.
what did madueke do? nothing

the reasons investors did not build
refineries over the years was lack of cheap
crude but the biggest reason is corruption
how?

licences were given to companies without
the financial muscle to build refineries also
part b of the license clearly states that
these armed robbers have oil lifting license
embedded in their refining license,
tell me who will choose refining over lifting
where he makes instant profit and inflated
subsidy
what did madueke do? nothing as usual

do you know that NNPC does not have
storage facilities for all those millions of
products they are quoting and importing.
how exactly does Nnpc wish to store
30million litres of pms?
do you know that these fg goons went
ahead to licence importers without storage
facilities leading to the govt paying extra
for storage on a product they are paying
over 70 naira as subsidy can u beat this
stup1dity and incompetence?

what did iweala and madueke do? nothing,

do you know that these leppers in Nnpc
have no grading structure for imported
pms low grade,mid grade and high grade
all are pms same subsidy, same price even
ethanol blends have subsidy paid on them,
can you beat that?
even abroad where the products come
from have different prices. some are far
cheaper than others which ordinarily
should attract low subsidy


what did madueke do? nothing.

do you know that these bingos at Nnpc
dont maintain their pipeline networks
which ordinarily should link one depot to
the other,
they have to pay extra for tankers
transporting these products all are
subsidies.
eventhough their foreign jv partners are
maintaining over 1000 pipeline networks in
Nigeria.
what did madueke do?
nothing.


do you know that under madueke's watch
demurrage is paid as subsidy to these
importers .
how cant they be reponsible for their
import schedule?
is it not commonsensical for madueke to
prioritize the discharge of those vessels
quickly in tank farms as not to attract
demurrage for a product you are
subsidizing?


and they want us to tighten for a better
future? which future ? can iweala,Sls and
madueke plan for a sustainable future if
given the task?
dead failures.


for every extra kobo you pay on pms you
paid for madueke's incompetence.
now they can see high expenditure but
cant see how their incompetence is
inflating the subsidy regime.
Do u seriously think iweala will see it
comming if it was true that economy will
crash?


Let us analyze the genere and politics of
these issues
There are more misnomers than facts
surrounding this subsidy brouhaha.
First,
the Govt said the economy will collapse,
ridiculous indeed

secondly,

the Govt said
oil importers are a 'cabal', nearly fell off
my seat.
Comrades, 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
phenomenon gave rise to licensing of
some people to 'assist' the Nnpc in doing
their job for which they are paid for.
Please don't 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 not oblivious of the
fact that the landing cost is higher than
the stipulated price
To my greatest chagrin, the Jonathan’s
administration woke up and termed them
'cabals' who are fleecing the nation.


Assuming Ruben Abati goes abroad to buy
a TM 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?
We are not docile, If Nnpc lived up to their
responsibility, we won’t have need for the
importers in the first place.There is no
doubt that the subsidy regime is met with
corrupt practices, is it not the
responsibility of the govt to clamp down on
those malfeasance?
the Governor of central bank confessed
during the town hall meeting that he paid
subsidy to 15 fake vessels who connived
with customs to falsify their papers.
is this not fierce corruption?
and we have a shameless commander in
chief? by the way, how many naval officers
patrol our waters on tax payers account?
efcc,icpc etc
The only solution that came to the minds
of this disgruntled PDP administration is to
remove subsidy into-to not minding its
inflationary consequences.
This is the si1liest approach any human
being with brain if they have one can
summon.

Thirdly,

Jonathan insulted the intelligence of
Nigerians telling us that we don't benefit
from this subsidy except for the importers
and he had the unbridled 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 says his mother did not benefit from
the subsidy that guaranteed the price in
the first place?
In a generator driven economy like ours?
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 erroneously juxtaposing it with GSM.
Do you know that the price of crude being
the raw material for refined pet. Products
are sold at the same price world overl?
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 70naira. At
this verge you will not over rule the fact
that these unscrupulous 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 a remote village in the
delta between Belema and Kola
communities and i saw the local refinery
myself.
Conduct a chemical test on those cheap
diesels if you are not convinced and you
will realize a lot of additives are
missing.Sounds incredible but those are
the realities 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 either because there
is no cheap crude to supply these
refineries.


Do you know that even the petroleum
products from our present refineries at a
disappointing capacity attract subsidy?
that is what Sanusi is not telling Nigerians.
This Sanusi's buisness model of increasing
local price to attract investors is
misleading.

He should ask himself why so
many buisnesses left the USA for Asia and
Arrica between 1998 till 2008.
The reason was because cost of doing
buisness in America was high so there was
need to tap into Africa's cheap land and
asia's cheap labour.

If you increase the pump price the spiral
inflation will discourage investors, you pay
high for land,labour, enegy etc.


A brief insight in Nigeria's oil and gas
model gives us a better outlook
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 barrels 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 about 450,000bbl/d which gives
45,000,000usd in monetary terms in other
words, the price of raw material in this
case, crude, accrued to our refineries
comes at 45m usd per day
, if you add refining cost and profit of 6usd
per bbl,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 daily earnings
(which will affect budget implementation)
and after refining will still spend more
money to subsidize it to 65naira/ l
(you now understand why NNPC subsidizes
the products from our refineries)
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 clamoring 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
realized i was dead wrong.


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 these
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.


At this verge, i must reiterate here that
competition amongst importers will only
crash the profit margin but not cost
price.Even if every Nigerian becomes an
importer of pet. Prods, we can never
change the fact that crude in the int l
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 addressed,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 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, conversely, if we make excess
crude revenue, 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 accrued 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
scrambling for funds and remembered the
ECR and insisted it must be shared to
enable them pay the new wage and
develop infrastructures.
you now understand why all state
governors are for subsidy removal
including the literally "one of us" comrade
Adams oshiomole, because they know it
will be shared just like the ECR


The way forward:


In the short run:


All unions must ensure the FG, must
consider these options,

1, identify and tackle the corruption and
incompetence prevalent in the subsidy
regime above. 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,


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


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


4, 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.


5, Instead of deceiving Nigerians with their
cabal bullshit and deluding them that they
don't benefit from this subsidy, the FG
should channel that propaganda with
intense lobbying to the senate,NLC and
civil society organizations 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 subsidiaries 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 a paltry
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 12usd 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 12usd/bbl and
make a little profit, with this cheap oil
available, Nigeria will have no reason going
to the JV.

This cheap crude is what will attract investors to build refineries and create jobs against sanusi's pump price increase to attract investors and create another monster called INFLATION,
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 coming
to build refineries.
A crude price of 18usd/bbl from NPDC will
guarantee pump price of less than 22naira
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 periodically.
this is necessary because Nigeria as a
member of OPEC has a limit to crude
export but we can earn more revenue from
petroleum products export.
Once the above takes effect, there won’t
be any need to be paying subsidy because
pump price will be around 23naira/ l and
inflation will reduce by 40‰.
Now, how competent is Allison Madueke
and iweala if they can’t figure this out?

To think of removing subsidy at this stage
where there is no electricity and high
corruption rate will be tantamount to
economic suicide.

I cant believe iweala and sanusi are using
trial and error approach to economic
solutions please try the next country or
preferably Haiti.

What iweala forgot is that in the face of
inflation, the cost of running Govt projects
will be high, All Govt contractors will
definitely come back for contract variations
or Abandon those projects.

As a sound economist, she should tell
Nigerians the value of 1.3 trillion naira
( she intends to save on subsidy removal)
in the face of 60% inflation and how many
projects Nigerians will benefit from the
subsidy removal.If you remove subsidy and
the money disappears, then it is a NO NO
for Nigerians.

Now, let us analyze possible solutions to
this economic quagmire.


I have a deal for iweala.


fight corruption and inefficiencies in the
subsidy regime and bring it down to
300billion for this year.

The management of Npdc must have a
target
of 150,000bbl/d by dec 2012.
on january 2013 subsidy will go by 50%
and by dec 2013 Npdc should guarantee
200,000bbl/d on

1st january 2014 subsidy must go 100%.
with or without the refineries on ground,
then if Nigerians are sacrificing, they will
know it has a
limit pending when refineries that will
utilize the cheap oil on ground arrives.

tell me what WE are sacrifising for today?
eternal slavery?

I and my generations cannot and will not
sacrifice for Govt's incompetence.

All unions should never accept partial
deregulation, it is more dangerous than
total deregulation because Nigeria hasn't a
price regulatory agency who ordinarily
should put the markets and commuters on
check.

Deregulation in the down stream sector is
not same as telecoms, we need structures
to support it which Nigeria have not got
unlike the later.

God bless you as you fight this battle for
mankind

Written by;

concerned oil and gas activists

Let's cut the crap and call a spade a spade WHERE DID THE PDP RAISE THE FUNDS TO RUN THE MOST EXPENSIVE PRIMARIES AND ELECTION THIS COUNTRY HAS EVER SEEN?

Somebody answer that.

YOU GUYS DON'T HAVE THE RIGHT FIGURES!!
Fuel subsidy didn't jump from N300 Billion to N1.3 Trillion!!

These are the figures for previous years:

2006: N261 Billion

2007: N278 Billion

2008: N633 Billion

Subsequent years saw a huge increase due to various factors which Efisher and others have mentioned!!

^ FALSE. If this were true then why was less than 300 billion budgeted for the subsidy in the 2011 budget? ? ? ? ?

Please don't peddle outright lies. The reasons advanced by efisher were ludicruous: those factors have existed in every year and did not lead to a 400 per cent jump in cost.

PapaBrowne:

YOU GUYS DON'T HAVE THE RIGHT FIGURES!!
Fuel subsidy didn't jump from N300 Billion to N1.3 Trillion!!

These are the figures for previous years:

2006: N261 Billion

2007: N278 Billion

2008: N633 Billion

Subsequent years saw a huge increase due to various factors which Efisher and others have mentioned!!

Can we see the figures of subsequent years along with the link where these figures have been quoted?

digidamage:

Back to the main issue. WHy the hullabaloo about the fuel subsidy and the subsequent decision to remove it? simple, because it suddenly went up to N1.6trillion naira. In 2009 & 2010 it averaged N270billion, or thereabout. So why the 500% increase in a year?
First, a few facts.
Between January 2011 and March 2011, FG paid an average of N22billion monthly as subsidy. At that rate, we would have paid around N264billion (which was close to the N240billion budget signed by the National Assembly). However, something happened afterwards. From April 2011, subsidy increased to over N100billion monthly and stayed that way until the end of the year. Don't forget, April was the mont of the elections. This is what we need to look into.
The funny thing, and i shudder as i think of this, is that there might be no cabal afterall. And even if they exist, they are not the ones who submitted the 2012 budget proposal to the National Assembly last December. The didn't propose a billion naira for feeding in the presidency. The didnt propose N300k for desktop computers etc. In any case, Nigerians didn't vote for the so called CABALS. These blame-game by the Jonathan regime must stop

GBAM! Very well said.

Mr. efisher, what u r proposing or insinuating here is so so unrealistic.
According to digidamage's analysis, did the 'cabals' suddenly start their false claims just because it was april or election time?
One thing i know is GEJ has alot to hide in his cabinet. This is our time to sort things out with a corrupt system.

@Deep sight' thumbs up!

You see no matter how relevant questions you ask these people they will never have a
Straight answer, instead they will meander run home sleep aπϑ think over it and find a very
Sweet talk to dodge the question. Such as that of that DAM minister of a woman. She forgets that she has children. Excuses like they flooded the market with pms their hands r tied (demonstrating still) is it the fault of the masses?.

I just hope they don't push these country to war! Thay are just thieving thieves!

Nice question
Personally at this point in time, the govt has to be sincere and answer this question, this is the questions Nigerians should have asked at the very beginning.
Femi falana did ask same questns today and answered it too on channelstv.
He said he had a document with him, which was the presentation PPPRA made to the senate at the very beginning of the debate, in it the values added up to these amount because payments were made in 2011 on backlogs of receipts dating back to 2009 and 2010, which means the total subsidy for last year is not the N1.3 trillion being brandished by govt officials.
He also queried this action since the law stipulated that all receipts should be settled within 45 days(/60 not so sure of the exact one now, but its within this value), so how come the carry over of about 1-2 years. He also said that an auditing firm did confirm this(KPMG)and many other loopholes in the sector that were responsible for massive corrupt practices.

The government does not have reliable data on the consumption rate either daily, weekly, monthly or yearly, the FM confirmed this at the town hall meeting so it would be difficult to sell and buy the opinion that's its about increase in consumption.

Bottomline of most arguements here is CORRUPTION. Agreed!

If only we can quantify what our true consumption history is, we would have been in a better position to know how much corruption contributed. It would however be wrong to whimsically claim that the entire rise over the period is 100% due to corruption. That's why I have tried to list few factors that may have also contributed.

in the end, the defenders of subsidy are as tongue tied as noi. all they can do is pull figures and assumptions out of the air and

btw - ignore ANYTHING papabrowne has to say. he is a self confessed spin and speller who spammed this board with falsehoos about work being done on lagos benin expressway in the run up to the elections

two months from now he will admit he was spinning and spelling to draw attention away fro gej's incompetence

The increase is due to the monies with which he bribed those who supported him at the primaries and the monies distributed to the various states during the last year April election. Most of those billions PDP spent was added to subsidy expense and now, they are trying to fool Nigerians thinking we are like them who do not use their brain.

hahaha  . . .I no fit laugh o. Shey the 5litre -10 litre wey people dey manage buy daily?

exchange rate as at  Nov 2008 was N118= $1  (I remember quite vividly 'cause I just returned from some trip outside the country then, and got a small gov't import contract that was affected by this). . .it went from N118 to N145-148 in Dec same year 2008.

Now since 2010 it has always been 151-154 Naira to $1, until July/August 2011 it jumped to N159=$1. And this has been the rate till now.

So my point is how come the exchange rate didn't play a major factor in 2009 or 2010 when we had about N30 devaluation? Why in 2011 when the devaluation was just less than 7naira averagely?

GboyegaD:

The increase is due to the monies with which he bribed those who supported him at the primaries and the monies distributed to the various states during the last year April election. Most of those billions PDP spent was added to subsidy expense and now, they are trying to fool Nigerians thinking we are like them who do not use their brain.

. Now you see how GEJ got them 99% and 90% turnouts . Chop Chop na Money o

Unless you have the right figures, it is silly to claim that those factors have contributed significantly to a four-fold increase.
Estimate increase in number of vehicles, consumption, generators and exchange rates and arrive at a figure that clearly shows any significance on a four-fold increase, until then it's pure conjecture and another round of silly excuses for an otherwise weak, compromised and utterly corrupt government.

from the mouth of the gej bootlicker

https://www.nairaland.com/nigeria/topic-423196.0.html

Beaf:

[size=14pt]Nigeria’s dependence on imported fuel ‘makes no sense,’ says US[/size]
By Agency Reporter, Published: Thursday, 1 Apr 2010

United States has described Nigeria’s reliance on imported fuel as something that “makes no sense.”

At a press briefing on Tuesday afternoon in New York, the US Assistant Secretary of State for Public Affairs, Mr. Phillip Crowley, said there was no reason for Nigeria, an oil-producing country, to be importing refined petroleum products except for the actions of some unnamed selfish people, Empowered Newswire reports.

On Monday, new Nigerian Ambassador to the US, Prof. Adebowale Adefuye, met with President Barack Obama at the White House, where he presented his letters of credence. Obama told the ambassador that “the prolonged absence of President Yar‘Adua has triggered much uncertainty in Nigeria.”

Speaking exactly 24 hours after the Obama-Adefuye meeting, Crowley recalled that “when Secretary Clinton was in Nigeria last August, she was very firm in her discussion with President Yar’Adua and other ministers about rooting out corruption, about making sure that the government was performing better.”

According to Crowley, “Nigeria is a significant country, one of the anchors of Africa, and yet – you see that it is a country that is blessed with considerable resources; and yet it has to import refined petroleum products. It makes no sense.”

“There is no rational basis for that to be occurring, other than you have a number of people in Nigeria who are looking after their own interest and not the broader public interest.”

He also spoke about the request of the US government for information on the true nature of Yar’Adua’s sickness. He said that it was indeed the right of Nigerians to be given such information.

The matter, Crowley added “is a question that we have. We are concerned about – we were concerned when President Yar’Adua was flown back from Saudi Arabia and there were questions about his ability to govern. I think those questions have, for the moment, been answered. We recognise the acting presidency of Goodluck Jonathan. We are very supportive of him.”

But he declared that the question is not really “for us. It is actually for the Nigerian people. They deserve to know that there is a government in place working on their behalf.”

But he assured that the US government remained “very supportive of effective governance in Nigeria, and we think that is crucial to making sure that Nigeria remains stable, remains an anchor in that part of Africa, and can play the role it has played regionally, and more broadly in terms of helping Africa advance.”

http://www.punchng.com/Articl.aspx?theartic=Art201004013305540

all the answers are right there

@ Jp Phlps:

'' Our three refineries at optimum capacity
utilizes about 450,000bbl/d which gives
45,000,000usd in monetary terms in other
words, the price of raw material in this
case, crude, accrued to our refineries
comes at 45m usd per day
, if you add refining cost and profit of 6usd
per bbl,The total cost becomes
270,000,000usd per day.''



which kin maths b dis wan o!  

more explanation needed becos, cost of crude ($100) + refining cost and profit ($6) = $106 X 450,000 barrels = 47,700,000

If we want to go down to the root of this, the first question will be: What volumes of product were actually delivered to the country and at what time. Next we should know how much slipped through the borders. Also, we need to know how much was retained or consumed in-country.

Then, we need to compare these with the financials. How much money was paid out, when it was paid out etc. If we don't have these facts, we cannot even begin to build the true picture.

If I'm paid as an auditor to do this job and given the facts, I will probably be in a better position.

Let's ask Okonjo Iweala, Sanusi, Deziani etc to tell us more. I guess they're in d best position.

efisher:

I've made my points, you have identified possible flaws, good and fine. Let those that have access to real data do the rest. I just love to analyse and I'm having fun.

I am highly dissapointed in your person! I was taken aback reading much of your post trying to justify the seemingly unexplainable 'qantas' of a N1tn jump in Fuel Subsidy.

Going by your post, I think it will be a complete and utter waste of time engaging your thrust of argument, rather I would avoid reading much of the post and excuse myself from this thread.

Efisher, the most practical solution would be to eliminate or at least reduce the corruption first, and then give us the correct figure of the required subsidy. The govt would then be in a better position to negotiate. Removal of subsidy would not eliminate corruption, over-invoicing, substandard products and smuggling as oil will always be cheaper in Nigeria.

The government had decided to work the other way round.

The government should have done lots of things before hand and removal of subsidy should have been the last thing

efisher:

If we want to go down to the root of this, the first question will be: What volumes of product were actually delivered to the country and at what time. Next we should know how much slipped through the borders. Also, we need to know how much was retained or consumed in-country.

Then, we need to compare these with the financials. How much money was paid out, when it was paid out etc. If we don't have these facts, we cannot even begin to build the true picture.

If I'm paid as an auditor to do this job and given the facts, I will probably be in a better position.

Let's ask Okonjo Iweala, Sanusi, Deziani etc to tell us more. I guess they're in d best position.

if you are waiting for these figures, then you are wasting your time. these guys are working on mere speculations. they have got no figures. just a bunch of careless officials who have deliberately decided to throw vigilance into thin air thinking the people are still in their slumber. unfortunately for them, Nigerians are awake now. thank God for the youth and what the social media & social network sites have empowered them to do.