The Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, has criticised presidential candidates who support petrol subsidy, calling the policy financially unsustainable for Nigeria.Lokpobiri spoke at the weekend during a breakfast meeting with media practitioners in Yenagoa, Bayelsa State.
In August, the presidential candidate of the African Democratic Congress (ADC), Atiku Abubakar, said he would restore the petrol subsidy if elected president in 2027.On September 28, the presidential candidate of the Nigeria Democratic Congress (NDC), Mr Peter Obi, said his administration will restore the petroleum subsidy after tackling corruption in the country.Speaking during the event, Lokpobiri criticised the positions of both opposition presidential candidates who have expressed support for petrol subsidy.“Where would the money come from?” he asked.
“The money is expected to come from the same oil sector.”Lokpobiri said the subsidy regime consumed resources the country could no longer afford to spend on keeping petrol prices artificially low.“The point I am trying to make is that if that decision was not made on subsidy removal, Nigeria would have been like Venezuela,” the minister said.“God forbid, even Nigeria like Venezuela would not be able to gather here the way we are gathered today.
Venezuelans queue even to buy bread. That is the level of poverty.”He said that when President Bola Tinubu assumed office, the federal government was projected to spend about N18.4 billion daily on petrol subsidy payments, citing figures previously presented to the national assembly by Zainab Ahmed, former finance minister.Lokpobiri also attributed the financial weakness of the defunct Nigerian National Petroleum Corporation (NNPC) partly to the subsidy regime, saying the oil company struggled financially before its transformation into NNPC Limited.“You recall that NNPC never paid any dividend.
NNPC never made any profit at all. What they were doing was shipping out crude and shipping in refined products. NNPC was the sole importer of refined products,” he said.“If you say you own 60 per cent of a business, you also have to pay 60 per cent of the cost of doing that. That is the cash call.“But before this government came, NNPC couldn’t pay its cash call. Today, NNPC is not owing any cash call.”On crude oil production, the minister said Nigeria had the potential to produce between 2.5 million and 3 million barrels per day but remained constrained by inadequate crude evacuation infrastructure.“Our big challenge is that of evacuation. The pipelines today have all expired.
They were used some 50 years ago, but the lifespan of those pipelines is gone,” he said.Lokpobiri said thousands of previously shut-in wells could be brought back into production through re-entry programmes.However, the minister said increasing output without replacing the ageing pipeline network could create further bottlenecks.He said NNPC was working on a comprehensive pipeline replacement programme under a public-private partnership arrangement.Lokpobiri added that the project would take some time to complete, “but once that is done, our capacity will rise astronomically”.