Oil
Oil workers plan to resist sale of refineries
LAGOS – Oil workers under the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN), and the National Union of Petroleum and Natural Gas Workers (NUPENG), have said they would resist the Federal Government’s plan to sell the nation’s refineries.
The two trade unions said their opposition to the sale is against national interest and that the country would not benefit from the exercise.
PENGASSAN President, Comrade Babatunde Ogun, claims the deal could benefit some government’s officials’ cronies.
He said the reasons for the problems at the refineries were that the government underfunded the refineries and refused to carry out Turn-Around Maintenance (TAM), and supply crude to them.
He explained that instead of opting for sale, the Federal Government should adopt a modified process tailored towards the Nigerian Liquified Natural Gas (NLNG), with the National Oil Company (NOC), as owners of the four refineries holding a substantial minority shares, while core investors/local participation hold the working majority with the staff, trade unions, and the host communities holding minority shares.
He advised that the government to deal with the problem of pipelines vandalism that hamper the supply of crude oil to the refineries as well as carry out TAM and see if the refineries would not work.
Ogun said: “The proposed sale of the refineries is against the overall national interest, but in the interest of a few, who are lurking around the corridors of power to milk the country dry. How can a country be selling all its national assets in the name of privatisation? For whose benefit are such sales?
“If you recall, the late President Umaru Yar’Adua reversed the privatisation of the refineries by former President Olusegun Obasanjo, with a promise to carry out Turn-Around Maintenance (TAM), on them to ensure that they were sold not as scrap. On assumption to office, President Goodluck Jonathan also promised to carry out TAM on the refineries.
“Even the controversial Kalu Idika Kalu-led National Refineries Special Task Force also had TAM or rehabilitation of the refineries to make them work in a safe and reliable manner as part of its recommendations. As we are talking now, nothing has been significantly done.
“Why is the government proposing the sale of these national edifices without doing the needful to ensure that the refineries work at their optimal capacity? Nigerians and the public deserve to know more on the desperate reasons for the spate and row of proposed privatisation, even when the selfish motives of these proposed national assets sales can spell doom for the country.”
He also said the refineries should be entities independent of either the Nigerian National Petroleum Corporation (NNPC) or the proposed NOC as in the Petroleum Industry Bill (PIB), while the board of management of each refining company should be fully responsible for its success and failure.
Ogun said those planning to sell the refineries and their cronies planning to buy them should emulate Alhaji Aliko Dangote and establish their own refineries instead of waiting to corner the nation’s common investment.
He also said instead of privatising the refineries, the government should grant effective incentives to allow for the development of private refineries alongside the existing ones, adding that a framework should be articulated that will make available, required crude for effective functioning of local refineries.
“There is need to incentivize and,or compel IOCs to refine an agreed percentage of crude oil in the country. A suggestion is to tie upstream licensing to downstream investment and private ownerships of jetties should be encouraged.”
“As the privatisation trend continues, the Nigerian public will need to know from the process drivers, the number of jobs and investment that have been created as against the reality that some cronies are now being recruited as technical partners to front for the high and mighty as was the case with Eleme Petrochemicals Company Limited, which the government sold to Indorama for $225 million, a mega plant that is the second largest in Africa, which at the time of its sale was worth about $2.5 billion as fair market value.”
He continued: “Also at the time of the sale, the company was fully stocked and the materials needed for its TAM were being bought by the government. It only required working capital that was persistently blocked by bureaucratic bottleneck and undue government interference that delayed its efficiency.”
“Petroleum Minister Mrs Diezani Alison-Madueke said two weeks ago that the nation’s four refineries would be put up for sale by the first quarter of next year.
“We would like to see major infrastructural entities, such as refineries moving out of government’s hands into the private sector. Government does not want to be in the business of running major infrastructure entities and we haven’t done a very good job at it over all these years.”
“We are right now undergoing a major turnaround maintenance programme” of the refineries, Mrs Alison-Madueke said.
– THE NATION
In a strategic move to revitalize Nigeria’s oil and gas sector, the Federal Government has unveiled two key fiscal incentives aimed at attracting investment and enhancing energy security.
The announcement was made by Mr. Wale Edun, the Minister of Finance and Coordinating Minister of the Economy on Wednesday.
The first initiative, the Value Added Tax (VAT) Modification Order 2024, introduces critical exemptions for essential energy products and infrastructure, including Diesel, Feed Gas, Liquefied Petroleum Gas (LPG), Compressed Natural Gas (CNG), Electric Vehicles, Liquefied Natural Gas (LNG) infrastructure, and Clean Cooking Equipment.
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These exemptions are designed to reduce living costs for Nigerians, promote energy security, and accelerate the transition to cleaner energy alternatives.
The second initiative, the Notice of Tax Incentives for Deep Offshore Oil & Gas Production, offers new tax relief options for deep offshore exploration projects.
This measure aims to position Nigeria’s deep offshore basin as a premier destination for international oil and gas investments, boosting the country’s appeal to foreign investors.
These reforms are part of a broader set of policy initiatives, known as Policy Directives 40-42, endorsed by President Bola Ahmed Tinubu.
The directives reflect the administration’s commitment to fostering sustainable development in the energy sector and enhancing Nigeria’s competitive edge in the global oil and gas market.
By Yemie Adeoye
NIGERIA’s President Bola Tinubu has announced that the protracted ExxonMobil-Seplat upstream oil divestment will be formally approved by the Minister of petroleum within a matter of days, just as he announced his government’s intention to expand the Compress natural Gas, CNG buses initiative.
The President who stated this during his Independence day nationwide broadcast stated that the move is in line with his administration’s commitment to free enterprise, free entry and free exit in investments which is the hallmark of his administration investment policy.
“Fellow compatriots, our administration is committed to free enterprise, free entry, and free exit in investments while maintaining the sanctity and efficacy of our regulatory processes. This principle guides the divestment transactions in our upstream petroleum sector, where we are committed to changing the fortune positively. As such, the ExxonMobil Seplat divestment will receive ministerial approval in a matter of days, having been concluded by the regulator, NUPRC, in line with the Petroleum Industry Act, PIA. This was done in the same manner as other qualified divestments approved in the sector.”
The President also seized the opportunity to plead with Nigerians to be patient with his administration’s reform policies. “As your President, I assure you that we are committed to finding sustainable solutions to alleviate the suffering of our citizens. Once again, I plead for your patience as the reforms we are implementing show positive signs, and we are beginning to see light at the end of the tunnel”.
“Our energy transition programme is on course. We are expanding the adoption of the Presidential Initiative on Compressed Natural Gas for mass transit with private sector players. The Federal Government is ready to assist the thirty-six States and FCT in acquiring CNG buses for cheaper public transportation.
Fellow Nigerians, while we are working to stabilise the economy and secure the country, we also seek to foster national unity and build social harmony and cohesion. Our economy can only thrive when there is peace”. he enthused.
As part of the administration’s push to improve Ease of Doing Business (EoDB), Nigeria’s Vice President Kashim Shettima has expressed support for ExxonMobil’s plan to invest $10 billion in the country’s deep-water oil sector.
Speaking on Wednesday, September 25, 2024, during a meeting with ExxonMobil executives at the 79th United Nations General Assembly (UNGA) in New York, Shettima called the investment “a clear testament to the administration’s economic reforms and investor-friendly policies.”
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This announcement follows news that international maritime company DP World intends to develop a multibillion-dollar port project in Nigeria.
Stanley Nkwocha, Senior Special Assistant to the President on Media and Communications, shared the development in a statement on Wednesday. He quoted Shettima as saying: “ExxonMobil’s potential investment aligns with the vision of President Bola Ahmed Tinubu’s administration for a more investment-friendly Nigeria.
We are committed to fostering an environment that supports such transformative projects.”Shettima also discussed the administration’s broader efforts to improve the ease of doing business, highlighting the “Renewed Hope Agenda,” which aims to simplify bureaucratic processes, enhance transparency, and offer fiscal incentives to attract global investors.
“Our administration has taken bold steps to unify the exchange rate, remove fuel subsidies, and implement tax reforms. These measures, though challenging in the short term, are intended to create a stable and predictable business environment in the long term,” he added.
On the oil and gas sector, Shettima mentioned that the government is revising the fiscal framework for deep-water operations to attract investment while ensuring fair returns for the Nigerian people.
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