Patrick Ugeh
7 November 2009
Abuja — The Minister of State for Petroleum Resources, Odein Ajumogobia yesterday said the federal government would utilise funds accruing from the removal of the subsidy on petroleum products to provide good roads, drinkable water, build modern railways, improve healthcare delivery services and improve the funding for education.
The minister in a press statement issued by his press secretary, Florence Bolokor-Mohammed, also assured that the deregulation policy would not bring lasting hardship to Nigerians, adding that government had not fixed any specific date for the take-off of the policy.
The minister said the scarcity being faced by motorists across the country was due to panic buying by motorists and hoarding of the products by
some marketers arising from the rumoured November 1 take off date of the deregulation policy.
Ajumogobia said government was still consulting with stakeholders, civil society and the Nigeria Labour Congress, amongst varying interest groups in order to build consensus.
He explained that President Umaru Yar'Adua was favourably disposed to constructive advise and was keen on ensuring that all stakeholders including other interest groups are carried along in the process that would lead to the final decision on implementation of the policy.
He stated further that the same reaction presently witnessed should be expected from marketers and Nigerian motorists for any date, be it December or January that are rumoured again as the implementation deadlines.
He promised that government would not hesitate to inform Nigerians through the appropriate channels once a consensus is achieved.
Ajumogobia condemned the present regime of importation and marketing of products, which he described as a vicious cycle that only benefits a few people at the expense of government and ordinary citizens of this country.
The minister said government had expended about N600 billion in 2008 and was expected to spend more in 2009 in providing subsidies "which goes directly to the purse of this cabal."
He said the status quo can not be sustained and "thus the compelling reason to overhaul the present system in order to free it of inherent encumbrances, inefficiencies and corruption."
He emphasised that the deregulation policy would allow market forces to dictate prices of products, allowing for more players in the sector "thereby leading to efficiency that would positively impact growth across the entire sector."
Despite the minister's comments, it appears deregulation might have unofficially come into effect in Abuja as some petrol stations have adjusted their pumps to reflect higher prices.
One of such, Slan Nigeria, an independent marketer in Yangoji on the outskirts of Abuja was selling at N80 per litre with the new price conspicuously reflected on the pumps in the station.
On the other hand, a few other stations that had the government approved price of N65 per litre on display at their stations, either sold at higher prices to motorists or rationed what they dispensed from the pumps.
A number of motorists are therefore compelled to resort to the black market operating in front of many filling stations, including those in front of NNPC Towers in the Central Business District, Abuja. Black market fuel ranges from N150 to N200 a litre.
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