Nigerian National Petroleum Corporation (NNPC) has described the non-passage of the Petroleum Industry Bill (PIB) as a major impediment to investments in building local refineries in the country.
Dr Timothy Okon, Group Coordinator Corporate Planning and Director of Transformation of NNPC, made the statement in Uyo, while fielding questions from newsmen.
“We need to be clear about these things; that the fate of domestic refinery is sealed until there is commercial environment for it and this is where the PIB comes in.
Nigerian National Petroleum Corporation (NNPC) has described the non-passage of the Petroleum Industry Bill (PIB) as a major impediment to investments in building local refineries in the country.
Dr Timothy Okon, Group Coordinator Corporate Planning and Director of Transformation of NNPC, made the statement in Uyo, while fielding questions from newsmen.
“We need to be clear about these things; that the fate of domestic refinery is sealed until there is commercial environment for it and this is where the PIB comes in.
“The PIB will remove the whole subsidy business if that bill is eventually passed and accented to,” he said.
According to him, the inability of the National Assembly to pass the PIB has delayed the building of new domestic refineries.
He said this had induced the importation of fuel to meet national demand.
According to him, building new domestic refineries is not attractive because they cannot thrive under government regulation of the price of fuel, especially Premium Motor Spirit.
Okon said government could not fix the price of refined product when there was a subsidy regime.
He said building of refineries thrived where there were commercial incentives to encourage investors to build new ones.
Okon said it was not practicable to have people invest money in a business, while someone controlled the price.
The director stressed the need to create a favourable environment for investment.
“It is illogical for you to ask an investor to come and invest and then he buys the crude at international price and then somebody else is fixing the price of the product and then you wait till you have money to pay the subsidy.
“This is practical. You have to create an environment for investment. So that is why it is only government that is in that business.
“It costs billions of dollars to put up a refinery and then you set up the price whether the price of oil goes higher or not you say this is the price
you are going to pay or sell the products,” he said
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