he removal of the fuel subsidy has become a mechanism for the Buhari administration to signal an approaching spike in fuel prices. Before taking office, he stated explicitly that “Whoever says he is subsidizing fuel is a fraud”; now, that simply implies that Buhari himself is phony and a fraud for the fact that he now wants to toe the same path he condemned and deemed a ‘fraud’ 6 years ago, come next year.
When word spread a few days ago that the poorest Nigerians would receive a N5,000 allowance for transportation next year, the same class of Nigerians who had been promised the same amount every month by the same administration, it was clear that we were in for a massive ‘subsidy reduction.’ The current price range is N340 to N500 a litre, which means that even in the best-case scenario, the ‘subsidy removal’ will be more than 100%.
One does not need to be a petroleum expert to realize that the simplest way to lower fuel prices is to refine all of our oil at home, and one of the main promises made by the Buhari administration when it first took office was to not only get our refineries up and running as quickly as possible, but also to build new ones. The news of a proposed $2 billion refinery in the President’s home state of Katsina reverberated throughout the country. The NNPC told Nigerians in June 2020 that a whopping sum of N1.47 trillion had been spent on ‘revamping and maintaining’ the refineries in 5 years, despite the fact that all of the country’s 4 refineries have been comatose for years. Refineries that do not refine oil at all.
By March of this year, Buhari had sanctioned $1.5 billion for the ‘rehabilitation’ of the Port Harcourt refinery, which had boosted that sum by around N800 billion. The Dangote refinery will cost $19 billion and have a refining capacity of 650,000 barrels per day, which is 205,000 barrels higher than our refineries’ combined capacity of 445,000 barrels per day. A detailed examination of what has been spent on our refineries in relation to their operational capacities reveals that $26.5 billion would be sufficient to construct at least four new refineries. YES, in actuality, Buhari’s projected Katsina refinery has a capacity of 150,000 barrels per day (which is more than the existing Kaduna refinery’s capacity of 110,000 barrels per day) and will cost $2 billion. It is also worth noting that this amount includes the cost of pipelines to connect the refinery to Niger Republic. One might wonder why there is a plan to connect this yet-to-be-built refinery to Niger Republic when domestic demand is unmet. Something is not right about this. But that is a discussion for another time.
Buhari, as President and Minister of Petroleum, will not address the issue because he does not want the chaos to end. While he is borrowing indefinitely to fund ‘maintenance,’ the NNPC is telling us that it will borrow to buy into Dangote’s refinery, bolstering the theory that our refinery problem will not be solved because Dangote’s project has attracted people at the highest levels of government and their families. What is the catch? Dangote will sell us refined oil at the international market price, not at a reasonable price.
A well-intentioned government would have prioritized the privatization of these refineries a long time ago, bearing in mind Nigeria’s maintenance culture and the doubt that succeeding administrations would be as devoted. It would only seek to improve the ones on the ground in order to increase their worth and put it in a better bargaining position with investors.
Instead of working refineries to make life simpler for Nigerians, the poor man is now guaranteed N5,000 for transportation in the middle of a diabolical spike in fuel prices.
While President Buhari continues to borrow to do everything that only he sees and ‘maintain’ refineries, he has no guarantee that a N5,000 disbursement will last more than a few months at best. Buhari is hell-bent on not just destroying Nigeria, but also inflicting tremendous pain and suffering on its citizens. He shuts down every realistic means of survival they come up with, such as cryptocurrency trading. The DSS is dispatched to the location where doctors are being interviewed for international positions in order to sabotage the process.
Our major source of income, crude oil, has more than doubled since the global lockdown, but our finances appear to be in significantly worse shape. Nigeria may never be the same again when Buhari leaves office because he borrowed trillions of Naira from abroad to loot under the pretense of refinery repairs and other programs. Previous regimes might have squandered our resources as well, but they were never this callous to Nigerians’ predicament. No one has ever borrowed N30 trillion, and no one is likely to pay thugs to interrupt anti-fuel price marches, or charge the protestors with crimes, or to have police officers and troops shoot protesters in the face.
While this administration teasing its third and most crushing fuel price rise since taking office, money that would be used to build four new refineries from the bottom up is being spent to refurbish outdated ones.
God, help us!