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FG makes arrangement for 6-month petrol stockpile ahead of subsidy removal



The outgoing Federal Government plans a six-month petrol consumption reserve to mitigate the effect of the impending subsidy removal.

The subsidy removal is expected to take effect July 1. More than one month after the May 29 exit of the Buhari administration.

The government has earmarked N3 trillion for subsidy payment in the 2023 budget between January and June.


Some experts, including the Lagos Chamber of Commerce and Industry (LCCI), have argued that its removal will bring down Nigeria’s foreign debt and stimulate investment in the industry.

They, however, urged the government to cushion its effects on Nigerians.

The plans were announced by the Permanent Secretary in the Ministry of Petroleum Resources, Ambassador Gabriel Aduda at the press briefing marking the end of the Sixth Nigerian International Energy Summit (NIES) in Abuja.

According to him, the government will ensure a minimum of six-month sufficiency stock of petrol prior to the final phasing out of the subsidy regime.

The government had earlier removed the subsidies on diesel and kerosene.

The permanent secretary said the government will minimise the disruption of the subsidy removal on the economy.

Asked to explain what the government has put in place ahead of the subsidy removal, Aduda said: “I want to tell you that the ministry is taking it very seriously and all of us because we totally understand the removal of subsidy.

“But we also understand the greater importance of the citizens in the scheme of things. And as we speak, we are still taking a very close look at how best to achieve subsidy without disrupting the system of livelihood in Nigeria because that is our responsibility as a government.

“We have to ensure that that forex is made available for those that will do import. We have to ensure that there is some form of reforms where there needs to be.

“We have to ensure supplies are available for a minimum of six months. We have to ensure that when we finally do that the disruption will be minimal.

“There are quite a number of factors we have to look at. Yes, we are committed to the removal but we can’t be too certain until every indices have been considered to ensure that the effect on the removal is not so hard on the average Nigerian.”

The former Major Oil Marketers Association of Nigeria (MOMAN), Executive Secretary, Mr. Tunji Oyebanji, asked the government to unfold its roadmap for subsidy removal.

Speaking in a panel themed: “Setting agenda for complete midstream and downstream optimisation in Nigeria,” Oyebanji challenged the government to state whether it will provide forex for the importers or not.

He also urged the government to reveal whether Nigerian National Petroleum Company Limited (NNPCL) will remain the sole importer of the product.

Urging the government to come out clear on whether it will remove the subsidy in June or earlier, Oyebanji charged the government to avoid confusion.

He said: “So, we are saying that there needs to be a very clear roadmap for how this thing is going to be done so that all stakeholders are carried along and we can do it without, you know, any confusion being created in the industry.”

The former MOMAN boss decries the muzzling out of other private operators in the industry by the NNPCL since its incorporation.

On the development of the Compressed Natural Gas (CNG), Aduda said the government has made frantic efforts in developing the product in Benin City, Edo State, where over 1,000 vehicles are already fueling their vehicles with the product.

Aduda said: “If you go to Edo State, for example, under the Nigerian Gas Expansion Programme, the Edo State Government has been able to partner with the NEGP.

“They have all their stations in Edo State, we have one or two of their pump converted into auto gas. At the last time, we checked over a 1000 cars had been converted.”

“On the Airport Road, Abuja, there are four filling stations vending it,” he said.

The permanent secretary noted that the Head of the Civil Service of the Federation (HoCSF), has provided about 12 staff buses using auto gas.

MOMAN’s Executive Secretary Clement Isong welcomed the plan by the government to make forex available to petrol importers.

He spoke with The Nation on telephone last night.

Isong said: “It is good news that should be implemented early. That is good news. It means the government has listened to what we have been saying. The sooner they do so, the better.




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