Happy New Year! As the mountains surround Jerusalem, so will God’s protection surround you and your family this year. I am not a pastor, neither am I a tithe collector. But as a believer, I know that God hears my honest supplications whenever I ask for anything. So, believe and it shall be well with you.
When I wrote my last piece in December 2017, I had imagined that my next write up would be more of a motivational musing. I am sorry to disappoint you. Unlike Emperor Nero, I cannot sleep, while Rome burns.
If you are a Nigerian and you live in Nigeria, prepare yourself for a tough 2018. The signs are already obvious. If you think you have seen it all, wait until this All Progressives Congress (APC) led Federal Government shocks you again. Two things will likely happen before the end of 2018. President Muhammadu Buhari may deregulate the downstream sector of the oil and gas industry. Secondly, electricity tariffs will be likely jerked up.
Nigerians will remember this piece when these increments happen. Salary earners and struggling families will gnash their teeth. Things will be tough. People will complain and those threatening to vote out APC in 2019 will be too weak to go to the polling units on the day of election. These are my postulations and they will likely happen.
Now back to the main issue. The Senate, vis-a-vis, the National Assembly, missed a golden opportunity to win the hearts of the people on Thursday. The Senate and House of Representatives Joint Committee on Petroleum Resources (Downstream), had an investigative public hearing on the lingering fuel crisis rocking the country. It was a perfect moment to show to Nigerians that the highest law-making body was on their side. Like many other Nigerians who watched the live footage, I was disappointed.
Now, let me apologise ahead of time because I will offend some people. Senator Kabiru Marafa is the chairman of the Senate Committee on Petroleum Resources (Downstream). In fact, he presided over the investigative hearing. I know Senator Marafa personally and I consider him to be a good man. He is always available and he will never shy away from real issues. But like candidate Buhari in 2015, Nigerians had hoped that Marafa would rescue them. Sadly, I was disappointed.
Sweet-talking Minister of State for Petroleum Resources, Dr. Ibe Kachikwu and the Group Managing Director (GMD) of the Nigerian National Petroleum Corporation (NNPC), Mr. Maikanti Baru, appeared before the joint committee to explain to Nigerians why the fuel scarcity was yet to abate.
Swayed by comments made by senators ahead of the investigative hearing, one had expected that tough questions were going to be asked. Instead, the committee offered Kachikwu and Baru the platform to add more pains to Nigerians’ injury.
The President jettisoned the contentious fuel subsidy regime in mid 2016. The President who doubles as the substantive Minister of Petroleum Resources, described the scheme as a huge conduit pipe. He had vowed that under his watch, subsidy on petroleum products will never return.
For people who knew better, they did not rush to the bank. After all, they knew that the President was going to bow to powers that be. As expected and shamefully too, NNPC, which reports directly to Buhari, reintroduced subsidy payment in October 2017. Yes, you just read that.
And do you know who approved it? President Buhari. He assumed the role of the National Assembly, which is empowered by law to appropriate funds, to carry out its functions.
Angered by the move, Marafa hurriedly called a press conference. On Friday, December 29, 2017, Marafa vowed to stop the illegal subsidy regime, which according to him was not in any way appropriated for.
According to Marafa, NNPC and other stakeholders in the oil sector will have to explain to Nigerians how they arrived at the alleged subsidy payment more than a year after its stoppage.
“At our slated investigative public hearing on the sector next week Thursday (last Thursday), NNPC and other stakeholders should be prepared to explain to Nigerians who approved the subsidy for them and who appropriated it?” he fumed.
“There is complacency in the sector and sharp practices that must be stopped. They want to take us back to subsidy regime that has never been beneficial to ordinary Nigerians across the country. We cannot go back to such scam called regime which robbed the country N10 trillion between 2006 and 2016,” he said.
He said transparency in governance, which the government started with in 2015, must be strictly adhered to as far as sales and importation of fuel are concerned.
According to him, while the previous government swapped exported crude for imported refined premium motor spirit (PMS), the present government has been using a more transparent model of direct sale of crude oil and direct purchase of refined product.
When challenged that nothing may come out of the intended probe, he warned that the Senate is not a rubber stamp to any arm of government or anybody.
“Before we went on recess, I remember submitting on the floor of the senate that I am nobody’s man or rubber stamp, the same way I strongly believe that the Senate is not a rubber stamp for anybody or arm of government,” he said.
If Marafa issued the above threats, at what point did he grow cold feet? This is the aspect that gets many Nigerians angry. During the overhyped investigative hearing, Marafa did not allow any member of the committee to delve into the subsidy issue. For him, it was haram to go there.
When Senator Isah Hamman Misau from Bauchi State sought to know the existing working relationship between Kachikwu and his boss, Buhari, Marafa protested and barred him (Kachikwu), from responding to the question. Marafa claimed that it was ‘personal’ and was not part of the issue of discussion. He insisted that the Minister ignores the question.
As expected, Kachikwu embraced Marafa’s free ride and did not respond. The closest response he offered was not strong enough to clear the air on the frosty relationship between him and Buhari.
“We will go back when we leave here to go and finalise. It’s so urgent, so much that within the next one week, we should be getting something to the top executives approval, including the outstanding arrears issue that has bedeviled the industry. We will bring up memos and I am sure this is as important to Mr. President as anything on his table right now and I believe we will be able to see him and get this done quickly,” he managed to respond.
For me and for other Nigerians, the Marafa-led committee should have done better. Again, it is not over yet. The committee can still redeem itself. At least, it will still submit a report to the Senate, where a decision will be taken. Nigerians, including this writer, will be relieved if the misgivings expressed here are corrected.
This is an appeal and as a good listener, I know that Senator Marafa will put the interest of Nigerians first. If he does that, history will be fair to him. Nigerians cannot survive another increase in pump price. Right now, all eyes are on Marafa to do the right thing.
In case you missed what our sweet-talking Kachikwu told the committee, let me reproduce some parts here. After reading this, I expect you to get worried. The suggestions he offered are anti-people and none will serve the interest of Nigerians.
He said: “What this country needs is to ensure that the refineries work. It is shameful that after more than 50 years, we still do not have working refineries. Selling crude is like selling raw agricultural materials. Once the private refineries start working, this scarcity issue will be behind us. Before we get there, we have 18 months to manage this problem.”
“On behalf of President Buhari, I apologise for the difficulties Nigerians faced over the fuel scarcity suffered during the festive seasons. Our sympathies go to the Nigerian people. I will not say much.
“All I can say is that there are lots of issues. The major players stopped importation because of the price difference in landing cost. Once that happened, NNPC started providing 100 per cent products to the local market.
“There are issues on ground. Some are due to nonpayment. Whenever situations like this arise, other issues arise. People moved products to other countries and decided to hide the products. We had to move in and release these products.
“What this says for me is that the business model of oil is not where it should be. If the prices of refined products escalate internationally, we do not react when we should. When it increases internationally, it has its own effects here. Between now and 2019 when our refineries will start working, we will have to rely on importation.
“During the 18 month emergency period, we need to look at pricing. We need to find a way to get marketers back to importation. Landing cost is about N170-175. We sell at N145. We need to address this problem. There are series of items. But the key item is the international selling price for sale of refined product.
“There is a gap. How do we deal with the gap? Whatever we do, we need to free the marketers to do their business. When pump price was tagged at N145, the exchange rate was N205. One model is for the CBN to create a special exchange rate for independent oil marketers to import their products. This will help.
“Is there a way to grant them tax holiday? Government can look into the taxing system. If they do that, marketers will have more funds to import products. Is there a potential of having a plural pricing system? That is, NNPC outlets can sell at N145, while independent marketers can import at their rate and sell at their own rate. Until we deal with this issue, we will not get out of the problem.
“We have not been able to deal with the issue of border policing. It is still more lucrative to sell this product outside the country. I am proposing that trackers be placed on trucks leaving the depots. That is one way to deal with this issue.”
You be the judge. The more we look, the less we see. This is the sad irony of a country called Nigeria. May God help us all!
I so submit!
One more thing…
Like I wrote last week, the Senate has roughly one year and six months to get things done. In 2018, delays will not be golden. Whatever needs to be done must and should be done immediately.
There are several pending reports in the Senate. In 2018, I urge the revered chamber to be in a hurry and consider the reports. Most importantly is the Petroleum Industry Bill (PIB). Senate has passed one version of the bill. It needs to move fast and pass the second phase. President of the Senate, Bukola Saraki, should do the needful and mount pressure on the Speaker of the House of Representatives, Yakubu Dogara, to give the bills speedy concurrence.