The Federal Government will spend $1.6 billion equivalent (N250 billion) on the turn-around maintenance of the Port Harcourt, Warri and Kaduna refineries, Minister of Petroleum Resources Diezani Alison-Madueke has said.
The minister disclosed this in Abuja yesterday while being grilled by the Senate Committee on Petroleum Resources (Downstream) over the failure of the government to fix the refineries.
She said the beginning of the fourth quarter of 2014, the turn-around maintenance project would have been completed, and the three refineries would be producing 370, 000 barrels per day, which is about 90 percent of the 445,000 barrels needed daily.
She said the project would start with the Port Harcourt refinery which, she said, would gulp $146 million out of which $32million (75 percent) had already been paid for the materials needed.
On why petroleum is selling at varying prices across the nation, the minister merely said: "Since the price was changes in January, it has become difficult for the market forces to stabilise at the official price. There is a major issue of supply partly due to subsidy payments. We are battling hard to ensure sufficient supply."
But the committee said petroleum was selling at varying prices because that the minister was allocating the product to the independent marketers with preferential treatment.
The chairman of the committee, Senator Magnus Abe, said: "How can filling stations sell at N97 per litre when the PPMC, as we have discovered, collected money from marketers without supplying them the product on time. Honourable minister, have you ever gone to the depots to see what marketers go through. We were told that you are giving allocation to only those who have godfathers. Unless this anomaly is removed from the source, we can't force filling stations to sell at official prices.
The committee also asked the minister to "digitalize" the process of allocating the products to enhance transparency, saying the "current analogue process is creating hidden costs".
Earlier, the Managing Director of the Products and Pipelines Marketing Company, Haruna Momoh, noted that there 774 vandalised points between Aba and Enugu along, saying unless the activities of the vandalisation of pipelines is addressed, the nation would continue to have problems in the distribution of oil products.