The Chairman, Senate Committee on Petroleum Downstream, Sen. Garba Marafa, on Thursday said total deregulation of petroleum downstream sector remained the best option to salvage Nigeria’s economy.
Marafa, who spoke on the sidelines of ongoing 16th Nigeria Oil and Gas conference in Abuja, said that the Senate had consented and moved for total deregulation of Premium Motor Spirit otherwise known as petrol.
According to him, total deregulation is the solution and the 8th Senate is determined to give Nigerians a direction in the downstream and curb the corruption in the sector.
He said, “We are addressing the governance aspect of the Petroleum Industry and Governance Bill (PIGB) because we know that PIGB will address the challenges confronting total deregulation of the downstream sector.
“We have assured Nigerians that the Petroleum Industry Governance Bill will be passed latest in March. The Bill will by the end of March go through third reading.
“The Bill seeks to address all governance-related issues in Nigeria’s oil and gas sector.
“Once a bill gets to the third reading, it is as good as passed. We are expecting the bill to be passed in March or latest by April.”
The lawmaker said that the Department of Petroleum Resources would be made stronger in order to regulate effectively.
He said that failure of the downstream sector necessitated the introduction of PIGB, but regretted that the bill was not treated properly in the National Assembly for several years.
He said, “This assembly is determined to pass it and it will be passed latest, by next month (April). We will later look at the fiscal terms and community issues.’’
According to him, President of the Senate, Dr Bukola Saraki, took it upon himself to ensure that the bill is passed this year.
The committee chairman said that the Senate has ordered an investigation into subsidy claims because there were allegations that Nigerian National Petroleum Corporation (NNPC) had collected over N5tn as subsidy claim from 2006 to date.
He said, “The civil society and labour unions should frown against subsidy regime and embrace total deregulation.
“If you combine NNPC and marketers’ subsidy claims, you will see that it is over N9tn in the last 10 years. This is almost twice of our national budget.
“I wondered if the common man gets value for this subsidy. If the money was directed into other infrastructure development, we would have gone far in infrastructure building.
“Diesel has been deregulated and we are better off; why are Nigerians afraid of subsidy removal? Right now, the government is indirectly paying the subsidy.
“We have to be realistic and take the right decision; we have to choose between building more infrastructure and consuming subsidy.
“Deregulation will promote local refining of crude oil and create more value and generate employment.”
Marafa explained that competition would push down prices of petroleum prices in the long run and that hypocrisy of the elite was regulating the price.
“All the people benefiting from fuel importation will never let deregulation to happen,” he said.