BusinessDay

Subsidy: Reps to probe consumption of petroleum products

The House of Representatives ad-hoc committee set up to investigate the petroleum products subsidy regime from 2017 to 2021, says it will determine the actual consumption of products as reflected in the Nigerian National Petroleum Company (NNPC) report for subsidy.

Ibrahim Aliyu, chairman of the ad-hoc who said this while addressing journalists in Abuja, also disclosed that the panel will probe direct sales and direct purchase arrangements for petroleum products which have affected the growth of the oil industry for many years.

The House had constituted the committee after it adopted a motion sponsored by Sergius Ogun from Edo State, who expressed worry that the consumption rate of petrol was 40 to 45 million litres per day, but the NNPC uses 65 million to 100 million litres per day to determine subsidy as discovered from its monthly reports to the federal allocation committee.

The lawmaker also expressed worry that: “the subsidy regime has been unscrupulously used by the NNPC and other critical stakeholders to subvert the nation’s crude oil revenue to the tune of over $10 billion, with the records showing that as of 2021, over $7 billion in over 120 million barrels have been so diverted.”

Read also: ‘Fiscal time bomb’: Petrol subsidy hits N2.1trn

Consequently, the ad-hoc committee chairman said his team will also determine the impact of subsidy on the Nigerian economy and examine the state of Nigerian refineries which have become comatose and are undergoing rehabilitation.

According to Aliyu, subsidy is “an issue that concerns all of us. It concerns the economy of our beloved country Nigeria and I don’t want to pre-empt the findings of the committee but actually, there are issues that we are concerned about.

“Specifically this committee is going to work on the subsidy regime. We need to understand what subsidy is all about. In the market today those of us that use diesel, know that because there is no subsidy on diesel if you go to buy it is as high as N800 per litre.

“The petrol you buy at N165 but try and check the global market, even the neighbouring countries, how much are they selling a litre, then you will understand the country subsidises that price for you to be able to afford to buy and make life easier. So within this, a lot now comes in.

“The direct sale direct purchase; you give the crude oil in exchange for refined products. What litres of crude oil do we give in exchange for what litres of refined product? How many litres of refined petroleum products are imported daily and how many are utilised?

“Now we have a committee that is trying to check the actual rate of consumption. So we will do the maths and interrelate. There would actually be synergy between this committee and the actual amount of fuel consumed daily and to know how much Nigerian government is paying or sacrificing for the convenience of the fellow citizens.”

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