Suspend Outsourcing Nigeria’s Refineries, Reps Tell NNPC

Minister of State for Petroleum Resources and GMD, NNPC, Dr. Ibe Kachikwu
Minister of State for Petroleum Resources and GMD, NNPC, Dr. Ibe Kachikwu

THE House of Representatives Committee on Privatisation has asked the Nigerian National Petroleum Corporation (NNPC) to suspend the proposed outsourcing of the nation’s three refineries in Kaduna, Warri and Port Harcourt.

The legislature’s request came on a day oil prices approached the $50 per barrel target, rising as much as one per cent to above $49 per barrel after the United States reported a larger-than-expected drop in crude stocks for last week.

Sadly, however, the resurgence of militancy in the Niger Delta, which has forced production down to 1.4mbpd, out of its allocated 2.2mbpd, has denied Nigeria the opportunity to benefit maximally from the rise in oil price.

The House committee chaired by Hon. Ahmed Yerima (Bauchi APC) at its sitting Wednesday accused the NNPC of acting unilaterally without consulting other stakeholders on its proposed outsourcing of the refineries, saying the NNPC had violated section 11 of the Bureau of Public Enterprise (BPE) Act 2009.

Although the committee was miffed by the absence of the Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, who was represented by the Group Executive Director for Refineries, Mr. Anibor Kragba, it, however, commenced its enquiry into the proposed outsourcing following the executive director’s assurance that he had the minister’s mandate and was, therefore, competent to handle any question on the refineries.

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Kragba clarified that the refineries were not being privatised, but rather being outsourced to core investors, explaining that it was aimed at getting investors to invest and rehabilitate the refineries, which he said was cost intensive.

Tempers flared when he could, however, not respond to queries on the authorisation of the outsourcing, without the knowledge of the National Assembly or the

He explained that he could not provide an answer as he was new in office.

The response did not go down well with the lawmakers, some of whom reminded him that they had wanted to postpone the meeting due to the minister’s absence and fear that he (Kragba) might not be able to handle all the queries.

Speaking earlier, the acting Director General of BPE, Mr. Vincent Akpotaire, said the organisation was not involved in the outsourcing exercise.

In a similar development, the Deputy Speaker, Hon. Yussuff Sulaimon Lasun, lamented the downward trend of oil production, now at 1.4 million barrels per day, saying that Nigeria did not own its oil industry.

He spoke while receiving the 2013 Audit Report by the Nigeria Extractive Industries Transparency Initiative (NEITI) of the oil and gas industry and solid minerals sector wednesday.

Lasun said Nigeria was being short-changed by the multinationals operating in the sector. “Nigeria as a nation has lost the oil industry. We don’t have the skills, the technology, we have not even mastered the politics or the marketing of oil. We swap 450,000 bpd and collect just PMS. What about other by-products of crude? We are probably the only country that is not getting the best of our oil deposits,” Lasun said.

He added that the legislature had not been able to effectively carry out its oversight functions in the sector as it was constantly accused of interference by the executive arm.

He charged NEITI led by the Executive Secretary, Mr. Waziri Adio, to submit draft bills that would ensure effective reforms in the extractive resources sector.

“You are in the best position to tell us the challenges you have encountered in the course of doing your job. Draft the bills, we would fine tune them, you are the experts,” he urged.



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