Oil marketers have explained the need for federal investment in regional refining.
When local refining is fully operational, local oil marketers estimate that consumers will save at least N70 a litre on gasoline.
At a speech on the advantages of the Federal Government’s investment in functional refineries, Mike Osatuyi, National Controller Operations of the Independent Petroleum Marketers Association of Nigeria, reportedly said this.
Although the contracts for refurbishing refineries had been issued, he told The PUNCH on Wednesday that it would be a great development for repairs to be finished as soon as feasible to relieve the strain and significant financial burden of imports on the nation.
He said, “The contract has been awarded already before the new government came into office. IPMAN doesn’t know the context of the contract, but if the refineries are working, it would cut freight and ship-to-ship transfer costs.
“Not less than N60/N70 per litre will be off if the refineries start working.”
He listed other benefits of operational local refining as reduction in insurance costs, reduction in product delivery time, and increase in employment.
According to him, “Cost of insurance would reduce, and then if we keep importing, it takes about 30 days for ships to arrive in Nigeria and we would have to pay for hiring the vessel.
“But if we refine in the country, products would arrive within one day. There will also be more jobs for the masses. It’s a lot of benefits.”
A former Chairman of the Major Oil Marketers Association of Nigeria and Chairman/Chief Executive of 11 Plc, Tunji Oyebanji, said marketers did not prefer products importation over local production.
“We want local refineries to work because we don’t enjoy importing,” he said.
Nigeria still relied heavily on petrol importation due to lack of functional local refineries.
Petrol prices have increased dramatically since subsidies were removed on May 29. They went from around N198/N200 per litre to N617 per litre.
After the removal of subsidies, local consumption has decreased by 30% from the pre-subsidy record of 66 million liters per day.
In response to the agitated social issues caused by the rise in gasoline pump prices, IPMAN’s national president, Chinedu Oknokwo, stated during a House of Representatives Public Hearing on Tuesday that Compressed Natural Gas should be quickly adopted as a clean, alternative energy source.