Nigeria Spends Over $10m Daily on Fuel Import

  • Nigeria Spends Over $10m Daily on Fuel Import

About $10 million (about N3.6 billion) is spent on petroleum products import daily, the Society of Petroleum Engineers (SPE) has said.

In the Organisation of Petroleum Exporting Countries (OPEC), Nigeria is the sixth largest producer of crude oil but depends on refined product imports to oil the engine of the economy, a development analysts say not only drains the nation’s capital base, but also reduces the job opportunities for the teeming population.

Speaking in Lagos at the weekend, SPE Nigerian Council Chairman Saka Matemilola said the huge foreign exchange (forex) could have been used to develop other areas to create jobs.

He said: “That is why it is important for the government to also ensure that the vision and the target of the country becoming self-sufficient in petroleum products by 2019 are given serious attention.”

On refinery projects, Matemilola acknowledged there was no way a business would succeed when funding is not available. He lamented that funding remained a major challenge confronting refinery projects.

According to him, there is nobody that will invest when he is not is unsure of getting returns on investment (RoI).

On the push to get the Liquefied Natural Gas (LNG) Act amended to make the company pay the Niger Delta Development Commission (NDDC) three per cent levy, the SPE chief said the LNG is not a gas producing company, but a gas processing entity.

A producer, he explained, brings the product from the subsurface to the surface. He warned that making such an amendment would send wring signals to the international investing community.

Matemilola said though the government was doing its best to clear its backlog of debts to companies despite its dwindling resources, it needed to do more to demonstrate to the international community and investors that there is sanctity of contract in the country.

“When we say we will do this, we do this, when we say we will guarantee this, we guarantee it, that is a very important thing; you cannot mandate all the international oil companies (IOCs) to establish refineries. Why are the companies that lift crude from this country not establishing refineries in the country? It is just because they find it easier to bring the crude to go and sell,” he said.

Matemilola said SPE has set up an advocacy group, including the government, Nigerian Gas Association (NGA), Nigerian Association of Petroleum Explorationists (NAPE), and other stakeholders, to engage the government.

About the Author

Samed Olukoya
CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and, with over a decade long experience in the global financial market. Contact Samed on Twitter: @sameolukoya; Email: [email protected]

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