Tinubu’s tax reforms may stifle oil sector revenue – PENGASSAN

.Says Port Harcourt refinery is functioning

The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN), on Tuesday, expressed concerns that the proposed tax reforms bill may stifle explorative activities in the oil and gas sector, leading to revenue shortfalls.

Festus Osifo, president of the association, while speaking at its National Executive Council NEC meeting in Abuja on Tuesday, appealed to the government to ensure that the tax relief exemptions given to those earning the minimum wage should be expanded to accommodate more people and companies in that category.

Osifo expressed concerns that Nigeria Upstream Regulatory Commission (NUPRC) and the Nigeria Mid and Downstream Petroleum Regulatory Authority (NMDPRA) would be negatively impacted if the bill sails through.

The tax reform bills, which have passed the 2nd reading at the Senate, is moving into the public hearing stage, where all stakeholders are expected to make inputs.

Osifo, however, said the proceedings on the bills, which have continued to generate interest amongst the stakeholders, must be transparent to enable the outcome reflect the will of the people.

He also called for clarity regarding revenue collection processes from oil and gas companies, noting that “some provisions in the bill have the likelihood of negatively impacting our members in some of our major branches like Nigeria Upstream Regulatory Commission (NUPRC) and the Nigeria Mid and Downstream Petroleum Regulatory Authority (NMDPRA).”

He said, “We shall be participating actively in the public hearing where our position will be well articulated.
“We hereby call on the National Assembly to conduct a proper public hearing session where different views will be collated to amend the provisions in the bill and not just to tick the box.$

Osifo, while speaking on the Port Harcourt refinery, confirmed that the refinery is “functioning“ even as he insisted that “PENGASSAN members were part of the team that ensured it came on stream this time around.”

Osifo debunked claims that the refinery has gone comatose few days after the much-celebrated commencement of production.

He however pointed out that prices of petrol may not fall immediately due to foreign exchange challenges.

“Until we tackle the foreign exchange problems, it may be difficult for prices to fall.”

Osifo, who is also president of the Trade Union Congress(TUC), revealed that the management of Nigeria National Petroleum Corporation Limited (NNPCL) pulled the feat because there was a dedicated escrow account for the revival of the refinery, as against the previous system where funds were domiciled in the Central Bank of Nigeria (CBN).

He however explained that “few limitations in the production processes may have forced the refinery to slow down operations”

He also explained that the blending process was normal globally, as no refinery can produce with a single Crude Distillation Unit (CDU), noting that the coming on stream of Warri and Kaduna refineries would bring the much needed relief to the country.

“As Nigerians, we have every reason to doubt the government. We have every reason to question assertions from governments because over the years, they have actually let us down.

“But the reality on ground, from our checks, is that the Port Harcourt refinery is actually working.
What Nigerians should be interested in today is, is the Port Harcourt refinery producing AGO? The answer is yes. Is the old Port Harcourt refinery producing kerosene? The answer is yes. Is it producing PMS today? The answer is yes.

“Over the years, PENGASSAN has been at the forefront of demanding that these refineries must be rehabilitated and brought back to operations. This we will not stop until the remaining three refineries successfully resume operations. Afterwards, we will mount a vanguard for the refineries to be privatized using the NLNG model that has worked efficiently over the year.”

The TUC President, while speaking on the power sector, advocated for the decentralisation of power generation and transmission by involving state governments and private sector players.