₦airaland Forum

NewNigeriaMind:
Someone steals your lunch money,

Uses it to buy food.


Then when you are about to die of hunger, the person gives you two spoon of rice.

And you are expected to be grateful.


Is ubah a philanthropist or is he running is business as a social entity.

The criminals have stolen from Nigeria, raped Nigeria blind.

Is it not the same ubah that was indited for subsidy fraud.

These criminals knows what awaits them some weeks time, hence this is a desperate move to buy public sympathy.

Will Mr ubah do the same if buhari was not the incoming president.

Ubah the criminal can keep his fuel, I rather take a public bus to work than buy the fuel.

Whether he release it or not, he is a fuel subsidy criminal and he will be prosecuted.

All the criminal

oya boycott his filling station and go look for fuel in places like "oando" and "conoil"

Nonsense

Ungrateful hypocrite

biafransoul:
Why is the name Ifeanyi Uba giving you sleepless nights? Instead of you to reprimand the ones that shout change with one corner of their mouths and at the same time are busy sabotaging the economy via Oando and the rest, you're here trying to castigate the one that has come to the rescue. Shame on you bloody hypocrite.

QuotaSystem:
There is actually some research done by a colleague at the University of Northampton which proves without reasonable doubt that the landing cost of imported petrol in Nigeria taking consideration of the fact that we have crude to exchange (containing more fuels like kerosene and bitumen) is just N35 proving the whole subsidy is a scam. Will make it available as soon as possible.

QuotaSystem:
There is actually some research done by a colleague at the University of Northampton which proves without reasonable doubt that the landing cost of imported petrol in Nigeria taking consideration of the fact that we have crude to exchange (containing more fuels like kerosene and bitumen) is just N35 proving the whole subsidy is a scam. Will make it available as soon as possible.

omenka:
Good thinking brother. Exactly my position on the other thread when it was revealed he want to dispose of his collection. It said it is a "trojan horse" and that that "isn't gonna stop him from being prosecuted if found guilty of any offence".

People may chose to clap for him for his "magnanimity", but I'm not buying the crap.

2cato:
Nigeria thirty five years ago under an illiterate dictator and now which is under a democratic leader is still the same to all the moronic posters above me. Instead of you people to be greatful to uba for breaking the monopoly of his fellow marketers. What do i expect from sildren of hate and anger? Foolirhness and stupidity.
Life is business and business has never been fair to any body. If you dont know how to do business and make a kill for the profit like ifeanyi uba i will suggest you swallow rock or hang ur self.

simplisity:
Tribalism full this nairaland, bcs he is from igbo tribe , that is y other tribes r against his patriotic gesture. Tribalism is one of the major canker worm that has eaten Nigeria real deep.

2cato:
Nigeria thirty five years ago under an illiterate dictator and now which is under a democratic leader is still the same to all the moronic posters above me. Instead of you people to be greatful to uba for breaking the monopoly of his fellow marketers. What do i expect from sildren of hate and anger? Foolirhness and stupidity.
Life is business and business has never been fair to any body. If you dont know how to do business and make a kill for the profit like ifeanyi uba i will suggest you swallow rock or hang ur self.

gcfrcom:
[s][/s]
When will you have sense?

QuotaSystem:
There is actually some research done by a colleague at the University of Northampton which proves without reasonable doubt that the landing cost of imported petrol in Nigeria taking consideration of the fact that we have crude to exchange (containing more fuels like kerosene and bitumen) is just N35 proving the whole subsidy is a scam. Will make it available as soon as possible.

December 10, 2011, if you stopped at the Mobil filling station on Old Aba Road in Port Harcourt , you would be able to buy a litre of petrol for 65 naira or $1.66 per gallon at an exchange rate of $1/N157 and 4 litres per gallon. This is the official price. The government claims that this price would have been subsidized at N73/litre and that the true price of a litre of petrol in Port Harcourt is N138/litre or $3.52 per gallon.

They are therefore determined to remove their subsidy and sell the gallon at $3.52. But, On December 10, 2011, if you stopped at the Mobil Gas station on E83rd St and Flatlands Avenue in Brooklyn, New York, USA, you would be a able to buy a gallon of petrol for $3.52/gallon. Both gallons of petrol would have been refined from Nigerian crude oil. The only difference would be that the gallon in New York was refined in a US North East refinery from Nigerian crude exported from the Qua Iboe Crude Terminal in Nigeria while the Port Harcourt gallon was either refined in Port Harcourt or imported. The idea that a gallon of petrol from Nigerian crude oil cost the same in New York as in Port Harcourt runs against basic economic logic. Hence, Nigerians suspect that there is something irrational and fishy about such pricing. What they would like to know is the exact cost of 1 litre of petrol in Nigeria .

We will answer this question in the simplest economic terms despite the attempts of the Nigerian government to muddle up the issue. What is the true cost of a litre of petrol in Nigeria ? The Nigerian government has earmarked 445000 barrel per day throughput for meeting domestic refinery products demands. These volumes are not for export. They are public goods reserved for internal consumption. We will limit our analysis to this volume of crude oil. At the refinery gate in Port Harcourt, the cost of a barrel of Qua Iboe crude oil is made up of the finding /development cost ($3.5/bbl) and a production/storage /transportation cost of $1.50 per barrel.

Thus, at $5 per barrel, we can get Nigerian Qua Iboe crude to the refining gates at Port Harcourt and Warri. One barrel is 42 gallons or 168 litres. The price of 1 barrel of petrol at the Depot gate is the sum of the cost of crude oil, the refining cost and the pipeline transportation cost. Refining costs are at $12.6 per barrel and pipeline distribution cost are $1.50 per barrel. The Distribution Margins (Retailers, Transporters, Dealers, Bridging Funds, Administrative charges etc) are N15.49/litre or $16.58 per barrel. The true cost of 1 litre of petrol at the Mobil filling station in Port Harcourt or anywhere else in Nigeria is therefore ($5 +$12.6+$1.5+$16.6) or $35.7 per barrel . This is equal to N33.36 per litre compared to the official price of N65 per litre. Prof. Tam David West is right. There is no petrol subsidy in Nigeria . Rather the current official prices are too high. Let us continue with some basic energy economics.

The government claims we are currently operating our refineries at 38.2% efficiency. When we refine a barrel of crude oil, we get more than just petrol. If we refine 1 barrel (42 gallons) of crude oil, we will get 45 gallons of petroleum products. The 45 gallons of petroleum products consist of 4 gallons of LPG, 19.5 gallons of Gasoline, 10 gallons of Diesel, 4 gallons of Jet Fuel/Kerosene, 2.5 gallons of Fuel Oil and 5 gallons of Bottoms. Thus, at 38.2% of refining capacity, we have about 170000 bbls of throughput refined for about 13.26 million litres of petrol, 6.8 million litres of diesel and 2.72 million litres of kerosene/jet fuel.

This is not enough to meet internal national demand. So, we send the remaining of our non-export crude oil volume (275000 barrels per day) to be refined abroad and import the petroleum product back into the country. We will just pay for shipping and refining. The Nigerian government exchanges the 275000 barrels per day with commodity traders (90000 barrels per day to Duke Oil, 60000 barrels per day to Trafigura (Puma Energy), 60000 barrels per day to Societe Ivoirienne de Raffinage (SIR) in Abidjan, Ivory Coast and 65000 barrels per days to unknown sources) in a swap deal. The landing cost of a litre of petrol is N123.32 and the distribution margins are N15.49 according to the government. The cost of a litre is therefore (N123.32+N15.49) or N138.81 . This is equivalent to $3.54 per gallon or $148.54 per barrel. In technical terms, one barrel of Nigerian crude oil has a volume yield of 6.6% of AGO, 20.7% of Gasoline, 9.5% of Kerosene/Jet fuel, 30.6% of Diesel, 32.6% of Fuel oil / Bottoms when it is refined.

Using a netback calculation method, we can easily calculate the true cost of a litre of imported petrol from swapped oil. The gross product revenue of a refined barrel of crude oil is the sum of the volume of each refined product multiplied by its price. Domestic prices are $174.48/barrel for AGO, $69.55/barrel for Gasoline (PMS or petrol), $172.22/barrel for Diesel Oil, $53.5/barrel for Kerosene and $129.68/barrel for Fuel Oil. Let us substitute the government imported PMS price of $148.54 per barrel for the domestic price of petrol/gasoline. Our gross product revenue per swapped barrel would be (174.48*0.066 +148.54*0.207+172.22*0.306+ 53.5*0.095+129.68*0.326) or $142.32 per barrel. We have to remove the international cost of a barrel of Nigerian crude oil ($107 per barrel) from this to get the net cost of imported swapped petroleum products to Nigerian consumers. The net cost of swapped petroleum products would therefore be $142.32 -$107 or $35.32 per barrel of swapped crude oil. This comes out to be a net of $36.86 per barrel of petrol or N34.45 per litre.

This is the true cost of a litre of imported swapped petrol and not the landing cost of N138 per litre claimed by the government. The pro-subsidy Nigerian government pretends the price of swapped crude oil is $0 per barrel (N0 per litre) while the resulting petroleum products is $148.54 per barrel (N138 per litre). The government therefore argues that the “subsidy” is N138.81-N65 or N73.81 per litre. But, if landing cost of the petroleum products is at international price ($148.54 per barrel), then the take-off price of the swapped crude oil should be at international price ($107 per barrel). This is basic economic logic outside the ideological prisms of the World Bank. The traders/petroleum products importers and the Nigerian government are charging Nigerians for the crude oil while they are getting it free.

So let us conclude this basic economic exercise. If the true price of 38.2% of our petrol supply from our local refinery is N33.36/litre and the remaining 61.8% has a true price of N34.45 per litre, then the average true price is (0.382*33.36+0.618*34.45) or N34.03 per litre. The official price is N65 per litre and the true price with government figures is about N34 per litre (even with our moribund refineries).

There is therefore no petrol subsidy. Rather, there is a high sales tax of 91.2% at current prices of N65 per litre. The labor leaders meeting the President should go with their economists. They should send economists and political scientists as representatives to the Senate Committee investigating the petroleum subsidy issue. There are many expert economists and political scientists in ASUU who will gladly represent the view of the majority. The labor leaders should not let anyone get away with the economic fallacy that the swapped oil is free while its refined products must be sold at international prices in the Nigerian domestic market.

The government should explain at what price the swapped crude oil was sold and where the money accruing from these sales have been kept. We have done this simple economic analysis of the Nigerian petroleum products market to show that there is no petrol subsidy what so ever. In the end, this debate on petrol subsidy and the attempt of the government to transfer wealth from the Nigerian masses to a petrol cabal will be decided in the streets. Nigerian workers, farmers, students, market women, youths, unemployed, NGO and civil society as a whole should prepare for a long harmattan season of protracted struggle. They should not just embark on 3 days strike/protests after which the government reduces the hiked petroleum prices by a few Nairas. They must embark upon in a sustainable struggle that will lead to fundamental changes. Let us remove our entire political subsidy from the government and end this petroleum products subsidy debate once and for all. It is time to bring the Arab Spring south.

Izielen Agbon Izielen Agbon writes from Dallas, Texas. izielenagbon@yahoo.com

He is former HOD , Petroleum Eng Dept, former ASUU chairman University of Ibadan, trained many operators in nation's energy industry with pratical experience on our practices and policy focus in the last 20yrs

GentleToks:
Why are you Igbos so infested with tribalism and victim mentality like this. It's only a cowards that buy his defeat with victim mentality.

Face issues like Yorubas and Hausa/Fulanis and stop hiding behind COS WE ARE IGBOS BULLSHIT.

I am very sure that if Kashamu was an Igbo man, Chaiii!!!! You lots would have shouting and screaming that he is being prosecuted because he is an Igbo man.

If Tafa Balogun was an Igbo man, victim mentality would have kicked him to exonerate him from wrongdoing.

You are all thieves and thank God now that we Yorubas have taken upon ourselves to explain to Nigerians host countries around the world that Igbos are the oones responsible for 95% of Nigerians crimes in their countries; bringing drugs into their countries not other Nigerians. And I think the evidence is coming out gradually. The outside world is beginning to understand that there is difference between Igbos and other Nigerians. And that is why the Indonesia policemen were calling Igbo all kind of names in that YouTube video.

QuotaSystem:
There is actually some research done by a colleague at the University of Northampton which proves without reasonable doubt that the landing cost of imported petrol in Nigeria taking consideration of the fact that we have crude to exchange (containing more fuels like kerosene and bitumen) is just N35 proving the whole subsidy is a scam. Will make it available as soon as possible.

muh4lyf:
Must you abuse people.. It shows the kind of person you are.

Neduzze5:
Na wa oo!

The man no bring out fuel, wahala!

The man con finally bring about the fuel, wahala too.


Make una buy the fuel and keep quiet na. Haba!!

FAJFARM:
It is so disheartening that people like u still come out to spit this rubbish u posted that makes u biliv u av said something. I pray u aren't a youth but a man of 50yrs. Y? Because for a youth to embrace this evil act this Uba did at this dying time is an embarrassment to we upcoming generation. Broz tells us u were joking with this stupid write up u posted.

Jesusloveyou:
if we can be patient for 16yrs,what stop us for just 4 days remaining, u and ubah can drink d hoarded fuel,we don't need it again, but be prepare for jail.

sniper77:
Please can you explain the survey you conducted to conclude that 95% of crimes in foreign countries are committed by igbos.You accuse them of tribalism and you just followed the same line as well by being tribalistic.You claim all Igbos are thieves and that is so wrong of you.

The truth is few of igbos might have committed crimes in Asia,europe and southamerica the same way few of yorubas,hausas,edos,urhobos,itsekiris,isokos,aniomas,efik,kalabaris,ijaws, and other tribes commit crimes all over Europe and USA and it is not a yardstick to use in making a pronouncement that all the people from the tribes listed are thieves

Don't be so filled of hatred for a tribe.

QuotaSystem:
There is actually some research done by a colleague at the University of Northampton which proves without reasonable doubt that the landing cost of imported petrol in Nigeria taking consideration of the fact that we have crude to exchange (containing more fuels like kerosene and bitumen) is just N35 proving the whole subsidy is a scam. Will make it available as soon as possible.

989900:

weyreypey post=34070981:
Please make it available...

Something like the below?



http://saharareporters.com/2011/12/15/real-cost-nigeria-petrol-dr-izielen-agbon

imsuboi:
Are you Yoruba?

simplisity:
Tribalism full this nairaland, bcs he is of igbo that is y other tribes r against his patriotic gesture.

beetruth:
What have a degenerated into? Have we totally lost our rightful thinking or just blinded with ethnicity or political affiliation. Is uba the only marketer in this country? Is it difficult to read and comprehend simple logic. Yes he may not be a saint, Yes he may be corrupt but if he has done well and you can't say it then pls ignore. This is totally uncalled for. A litre of petrol presently sells at N1000 per litre in black market in my area and one person has decided to ignore the call from his association of marketers to relieve us of this mess and yet we crucify him?? For what pls? We sure need not just to shout change but start with our way of reasoning. I just don't get it.

PassingShot:
The truth shall soon be revealed and those who are sabotaging the nation shall be brought to justice VERY SOON!

2cato:
Nigeria thirty five years ago under an illiterate dictator and now which is under a democratic leader is still the same to all the moronic posters above me. Instead of you people to be greatful to uba for breaking the monopoly of his fellow marketers. What do i expect from sildren of hate and anger? Foolirhness and stupidity.
Life is business and business has never been fair to any body. If you dont know how to do business and make a kill for the profit like ifeanyi uba i will suggest you swallow rock or hang ur self.

Neduzze5:
Talking to me? Or to yourself?

Biko swerve with full force jare!!

imsuboi:
Ungrateful bastards.


You Yorubas are disgusting!

**spits**