Private Refineries: FG to Refund Depositors

Following confirmation that some of the private refineries that were licensed to commence local refinery of petroleum products are on track, government has disclosed that promoters of the refineries who had paid the mandatory $1million non-performance deposit for building private refineries would be refunded.
Minister of State for Petroleum Resources, Mr Odein Ajumogobia, gave this assurance recently at the Oil Trading and Logistics (OTL) conference which held in Lagos .
Promoters of private refineries are expected to pay the deposit as pre-condition for the issuance of license to construct, but hey are expected o get a refund as soon as construction has reached 50 per cent completion. But many of them have complained that even though the refineries are more than 50 per cent completed, they are yet to get a refund.
Shipping Position Weekly has also reported two weeks ago that government has waived the mandatory deposit. The minister had stated that the deposit is disincentive.
“We have scrapped that deposit; it is a disincentive; it does not make sense. So, I and the Minister of Petroleum Resources decided to scrap it,” he said.
He stressed that government was desirous of a functional downstream sector which according o him, guarantees self-sufficiency in refining as well as availability of petroleum products at reasonable prices.

The minister however argued that this can only be achieved after the sector has been deregulated and liberalised for effective private sector participation, even as he regretted that government’s monopoly and dominance of the downstream sector has prevented the sector from engendering the growth of the economy.
He equally argued that government was not moved by the argument that the refineries must be fixed before deregulation. “We must start; we cannot wait until all the problems are fixed. Let us not make perfections the only means of progress. Deregulation is the only path of progress of the downstream sector, no matter the short-term sacrifice we will make,” he said.