backbencher:


But as i said it won't be cheap.

Plus in my opinion goverment setting prices for anything, crude inclusive, is a disaster awaiting

At the end people should be allowed to drill for oil.and people should be allowed to sell it at any price, international price included

At the end, fuel cannot cost less than 300 naira per liter .

Forget about whether it would be cheap or not. if the government is serious, Let's get the refineries working first and stop using our scarce Forex to import fuel at international rates and further deepen our economic woes to satisfy the cabal who are not in the least bit interested in the welfare of the people. Let's get an accurate picture of our domestic consumption and use it to set a quota for domestic refineries to produce. Let them buy from the nnpc in naira, refine in naira and sell in naira to Nigerians. I'm sure if the government beams it's eyes on the oil industry a lot of scams and padding in the so called production costs will be revealed and eliminated and as a result you will find out that these costs are not as expensive as you think.

budaatum:



I needed an excuse to sell my electric tomatoes, again.

Bros two words for you: 'essential commodities'.

Google that and the role governments have to play in ensuring these goods are available and affordable for their people.

budaatum:

The difference is, we are incompetent while Saudi Arabia is competent.

If as you say we are incompetent. Why then do you want incompetent oil workers to be paid at par with their competent counterparts in Saudi Arabia?

budaatum:


Still subsidies, which suppresses price, and discourages investment.

Remove current subsidies for pms importers and modulars will become profitable since they would not incur transport costs that importers incur.

Remove price controls too so they can sell at market price. Price at pump will initially go up, but increase in investment chasing profit will soon bring it down.

More propaganda. The US subsidises domestic agricultural production and this has not discouraged farming in the US in any capacity. If anything it has encouraged farmers to farm in the confidence that the government would cover any losses they incur if their produce is not sold or gets bad. So what are we saying?

China employs protectionist policies to ensure the interests of their indigenes are protected and that locally produced goods are way cheaper than what is exported to other countries.

Why can't we emulate these good practices

obi58:


If as you say we are incompetent. Why then do you want incompetent oil workers to be paid at par with their competent counterparts in Saudi Arabia?

Did you read the bit I said we hire oil workers from India and pay them exhorbitantly?

It's a global business, Obi. You pay market determined wages to get competent staff or hope your oil springs out the earth by itself or you get it out with our amazingly wonderful JuJu.

Nigerian startups are raising billions, but can’t find workers
https://restofworld.org/2022/nigerian-startups-are-raising-billions-but-cant-find-workers/

The Oil Industry Is Facing A Labor Shortage
By Michael Kern - Nov 30, 2021, 4:00 PM CST
The oil and gas industry worldwide faces a talent gap as workers contemplate moving to renewables or leaving the energy industry altogether, a survey by recruitment firm Brunel and Oilandgasjobsearch.com, cited by Reuters, showed on Tuesday.
https://oilprice.com/Latest-Energy-News/World-News/The-Oil-Industry-Is-Facing-A-Labor-Shortage.html

obi58:


More propaganda. The US subsidises domestic agricultural production and this has not discouraged farming in the US in any capacity. If anything it has encouraged farmers to farm in the confidence that the government would cover any losses they incur if their produce is not sold or gets bad. So what are we saying?

And you think that's a good thing?

Almost 90% of the $540bn in global subsidies given to farmers every year are “harmful”, a startling UN report has found.

This agricultural support damages people’s health, fuels the climate crisis, destroys nature and drives inequality by excluding smallholder farmers, many of whom are women, according to the UN agencies.

The biggest sources of greenhouse gas emissions, such as beef and milk, received the biggest subsidies, the report said. These are often produced by large industrialised groups that are best placed to gain access to subsidies.
https://www.theguardian.com/environment/2021/sep/14/global-farm-subsidies-damage-people-planet-un-climate-crisis-nature-inequality

obi58:

Why can't we emulate these good practices

But we do. Oil subsidy, wage subsidy, and I'm certain you are worth a lot more than 30k a month.

budaatum:


And you think that's a good thing?




But we do. Oil subsidy, wage subsidy, and I'm certain you are worth a lot more than 30k a month.

Bros we don't. It is standard global practice for serious governments to subsidize production of essential commodities instead of consumption. Saying subsidies is not good for economic growth is simplistic at best and elitist at worst because no economy can flourish without government intervention either via regulation or spending.

This is why we're canvassing for getting the refineries working again and government doing everything to ensure they operate optimally for the common good.

And you can keep on singing it that we need to pay international wage rates to attract the best oil workers. I refuse to believe that with our daily production quota we will be unable to pay those costs unless we sell crude in dollars.

Big lie.

obi58:

Bros we don't. It is standard global practice for serious governments subsidize production of essential commodities instead of consumption. .

Actually, serious governments tax production and consumption of essential goods because tax is the only place governments get their income from.

But you want government to now use that tax money to subsidise a portion of the economy to the detriment of the whole?

obi58:
Saying subsidies is not good for economic growth is simplistic at best and elitist at worst because no economy can flourish without government intervention either via regulation or spending.

Regulation and spending is not the same as subsidy, Obi, please!

Government can spend by investing, and the better spending is on infrastructure, and not on recurring consumption which is where subsidies end up.

obi58:
This is why we canvassing for getting the refineries working again and government doing everything to ensure they operate optimally for the common good.

Where I'm from we say, keep doing as we've always done so you get the results you've always gotten. I myself laugh at the stupidity of repeating what results in failure.

You've hopefully noticed that government has repeatedly failed at "doing everything to ensure they operate optimally for the common good" for decades now.

Government has not, can not, and should not run refineries or any industry because they are usually not successful at it.

Seriously, I can not believe I need to be telling you how incompetent our governments are!

obi58:
And you can keep on singing it that we need to pay international wage rates to attract the best oil workers. I refuse to believe that with our daily production quota we will be unable to pay those costs unless we sell crude in dollars.

I believe you should be paid a competitive global market wage instead of the paltry 30k the government insists on paying you. That way, you'd be able to travel internationally, pay good schools to educate your children, and buy a brand new car instead of having to settle for 15 year old junk from Europe and US.

But please forgive me if I am valuing you far much more than you are actually worth. I guess I'm assuming you are one of the best and worthy of a competitive pay instead of being paid peanuts.

Here's a good sum up of the effect of subsidies and government incompetence in my state.

Okerenla:

The distributable federal allocation for the month of January ( but shared in February) is an indication that there is a fire on the mountain because the allocation accruable to states dipped to a four-year low. Unlike in December 2021 when N699.82bn was disbursed, only N574.66bn was disbursed in January of this year. The sharp drop in the allocations follows the Federal Government's announcement of its plans to deduct N950bn for the payment of fuel subsidy allocations due to States in 2022. If the situation persists, many states, particularly grossly indebted states like Osun, would find it difficult to pay salary and pension of their workers because about 35% of what should be available to them would be sized down for subsidy payment. For January, Osun state, for example, was allocated N1.425bn but the sum of N1.8bn was deducted to service its loan. What this means is that the state did not only receive nothing in allocation, it also recorded a negative of N375m which would be carried forward in the next distribution..

uccheks:
Am I missing something. You pay subsidy on imported products with landing cost inclusive. Yet you can't pay subsidy to encourage local modular refining pending when you are sensible enough to deregulate. It's either I'm too stupid to understand what's up or the MD is a Duns. Irredeemable Clowns

Nigeria has always been a joke to itself/herself.

No, see this

if we start patronising the local refineries, and pay them the subsidy, even if they are loosing, there is a way business works,

They might not break even in 12 months, but being in business will help them learn which will increase their capacity and eventually help them grow bigger that they will not need subsidy to stay profitable

The big companies in the world did not start up with profit..

backbencher:


No, because it means the government will set price at a level where they lose money, and give them subsidy that won't even begin to cover their losses.

That's a big reason why we lost our old refineries.

Raypawer:
No, see this

if we start patronising the local refineries, and pay them the subsidy, even if they are loosing, there is a way business works,

They might not break even in 12 months, but being in business will help them learn which will increase their capacity and eventually help them grow bigger that they will not need subsidy to stay profitable

The big companies in the world did not start up with profit..

The thing is

1.Nigeria cannot afford subsides on petroleum. Unless we tax far more than the number of people we tax in this country.

2.Subsidies are why we have bad refineries in the first instance. Sell petrol at a loss, pay a subsidy that does not cover the loss, and the refineries lose money, and then break down, with sabotage and corruption finishing the job.

3. As much as we all hate the idea of expensive petrol, the only way to let the refineries work well...the modular refineries, is to allow them sell the petrol they make there at a profit.

4.Paying subsidies amounts to making the refineries sell petrol at a loss, and then pay them money called subsidy that barely or does not cover the loss due to a host of factors.

5.Call me a Buhari supporter, or a hater of the masses, or someone who loves dogs......modular refineries are a business. And the best way to run businesses is not to subsidise them into losses...so that we can buy fuel at N40 and be happy. People have to be paid for making the fuel available from the refineries.

backbencher:


The thing is

1.Nigeria cannot afford subsides on petroleum. Unless we tax far more than the number of people we tax in this country.

2.Subsidies are why we have bad refineries in the first instance. Sell petrol at a loss, pay a subsidy that does not cover the loss, and the refineries lose money, and then break down, with sabotage and corruption finishing the job.

3. As much as we all hate the idea of expensive petrol, the only way to let the refineries work well...the modular refineries, is to allow them sell the petrol they make there at a profit.

4.Paying subsidies amounts to making the refineries sell petrol at a loss, and then pay them money called subsidy that barely or does not cover the loss due to a host of factors.

5.Call me a Buhari supporter, or a hater of the masses, or someone who loves dogs......modular refineries are a business. And the best way to run businesses is not to subsidise them into losses...so that we can buy fuel at N40 and be happy. People have to be paid for making the fuel available from the refineries.

Backbencher, in my day this was form 3 Economics, and had been alluded to with "Mr Giwa was a trader" in primary school when "his shop was full of things to sell".

Did they abolish 'supply and demand', and 'price elasticity', when the current forms were abolished?

Your tenacity delights!

I like your view, but the point here is not paying them to run at a loss,

No, no, my point is that the modular refineries should as much as possible try to stay in operations

As we stand now, we are paying subsidy heavily and the modular refineries are not working, we are loosing heavily on both ends

Look at it from this angle, the modular refineries produce even if its 35% of total consumption in Nigeria, which will minimise their loss, and at the same time they are in operation

They then present what they have to NNPC, since NNPC is the sole importer now (according to them).

NNPC buys from them, and NNPC will sell to Nigerians at what ever rate they wish

They should negotiate with Government if they have to do so to get working

That way

1. The local refineries will stay in operation
2. We will have some more gainful employment in the country
3. The refinery operators will gain some business experience
4. We will save some money from shipping
5. Fuel scarcity will reduce as time to market will drastically reduce
6. We will save some FOREX and channel it to another sector
7. Corruption will reduce in a way

And that way, money flows back into the economy that will help us stay afloat

Until we are ready to deregulat the downstream sector.

The thing is

1.Nigeria cannot afford subsides on petroleum. Unless we tax far more than the number of people we tax in this country.

2.Subsidies are why we have bad refineries in the first instance. Sell petrol at a loss, pay a subsidy that does not cover the loss, and the refineries lose money, and then break down, with sabotage and corruption finishing the job.

3. As much as we all hate the idea of expensive petrol, the only way to let the refineries work well...the modular refineries, is to allow them sell the petrol they make there at a profit.

4.Paying subsidies amounts to making the refineries sell petrol at a loss, and then pay them money called subsidy that barely or does not cover the loss due to a host of factors.

5.Call me a Buhari supporter, or a hater of the masses, or someone who loves dogs......modular refineries are a business. And the best way to run businesses is not to subsidise them into losses...so that we can buy fuel at N40 and be happy. People have to be paid for making the fuel available from the refineries.

Raypawer:

I like your view, but the point here is not paying them to run at a loss,

No, no, my point is that the modular refineries should as much as possible try to stay in operations

As we stand now, we are paying subsidy heavily and the modular refineries are not working, we are loosing heavily on both ends

Look at it from this angle, the modular refineries produce even if its 35% of total consumption in Nigeria, which will minimise their loss, and at the same time they are in operation

They then present what they have to NNPC, since NNPC is the sole importer now (according to them).

NNPC buys from them, and NNPC will sell to Nigerians at what ever rate they wish.

Why should NNPC buy from local producers, Ray? Can local producers not find market of their own?

Subsidies distort market for local producers to the benefit of importers, and Nigerians really ought to be on the streets protesting against it. If subsidies are removed, local producers will fill the market and competition will eventually suppress cost and price and increase employment opportunities instead of providing employment where we buy from!

budaatum:

You're a disgrace to humanity, you can as well delete them

Currently NNPC is regulating everything, that's how they are able to pay subsidy

First of all, according to NNPC, they are the only once importing Fuel,

All the independent importers have been halted or they are now doing sub contract for NNPC, if their claim is true

That's why the downstream sector is regulated.

If we take NNPC out of the picture, Nigeria will blossom in a matter of 1 or 2 months, that has been our request for a while now

Total Deregulation of the Downstream Sector

It's the regulation from NNPC that is sending away alot of investors and big players

budaatum:



Why should NNPC buy from local producers, Ray? Can local producers not find market of their own?

Subsidies distort market for local producers to the benefit of importers, and Nigerians really ought to be on the streets protesting against it. If subsidies are removed, local producers will fill the market and competition will eventually suppress cost and price and increase employment opportunities instead of providing employment where we buy from!

Raypawer:
Currently NNPC is regulating everything, that's how they are able to pay subsidy

First of all, according to NNPC, they are the only once importing Fuel,

All the independent importers have been halted or they are now doing sub contract for NNPC, if their claim is true

That's why the downstream sector is regulated.

If we take NNPC out of the picture, Nigeria will blossom in a matter of 1 or 2 months, that has been our request for a while now

Total Deregulation of the Downstream Sector

It's the regulation from NNPC that is sending away alot of investors and big players

But local modulars don't need subsidy, since they are not importing, so why should they do the opposite of what would allow them to blossom by putting NNPC in the picture?

Remove "regulation from NNPC that is sending away a lot of investors and big players" from what you are suggesting, and I will invest in your wonderful blossoming idea, is what I'm saying. NNPC has far too much work to do already, so let them let modulars assist them without NNPC interference.

I just received a copy of The Prize: The Epic Quest for Oil, Money, and Power by Daniel Yergin.
https://en.m.wikipedia.org/wiki/The_Prize:_The_Epic_Quest_for_Oil,_Money,_and_Power

I doubt I'd ever read it myself, but the index has a whole heap on Nigeria that I do intend to read because knowledge is what will place the future in our hands.

If anyone does read it (and I tell you, it is readable just that my eyes don't work so well no more), do come educate buda please.

Petrol subsidy: Civil servants risk months of unpaid salaries
https://businessday.ng/amp/business-economy/article/petrol-subsidy-civil-servants-risk-months-of-unpaid-salaries/