Victor EzejaNigeria’s Ambassador to Burundi, Mr Elijah Onyeagba, has urged the Federal Government to adhere to the provisions of the Petroleum Industry Act (PIA) on deregulation to allow private sector players to come in.
He said that private investors’ participation in the oil and gas sector would be a game changer, adding that it would not only boost petroleum production and supply but also put the prices at a fairly affordable level, determined by competition in the market.
Join our WhatsApp ChannelAmbassador Onyeagba, who appeared on Channels Television Sunrise Daily on Tuesday morning, stressed that while trying to maintain control of the petrol prices, the government would continue to lose resources that could be channeled to other critical sectors like education, health, and roads among others.
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“Government needs to follow through the provisions of the Petroleum Industry Act (PIA) that allows for investors to come into that space. Government has no business doing business,” he said.
The diplomat, who is also an economist, said all the government needs to do is create an enabling environment for investors to come in and do business.
He also suggested that the existing refineries should be sold to professionals who would efficiently manage them, adding that the goal of every business venture is to make a profit, and as it is currently, the government is not getting any return from the investments, but instead spending on overheads to maintain the facilities and staff working there.
He noted that the bureaucratic structure and federal character principle that government has to always adhere to in personnel recruitment, often pose challenges in terms of ensuring efficient management of the public institutions.
“Our refineries haven’t worked and the reasons are very clear to everybody. By the way the government functions, the recruitment process has to ensure that there is representation across board. The issue of Federal Character is a big problem. Government has no business doing business.
“I believe that it is time our refineries are sold off. When President Obasanjo was about to leave office, some of those refineries were actually sold, but the government of Yara’Adua actually came and reversed that sale. I think it was an error because I believe that those refineries should be in the hands of people that should be able to manage them in a much better manner. And once that happens, the government would stop budgeting for turnaround maintenance, and salaries of people working in the refineries. These actually, should be taken off the government’s books. The business of the government should be to provide an enabling environment for the private sector to thrive.”
He further suggested that the Federal Government could also replicate what it did in the Dangote Refinery by having some percentage of equity stake while the major ownership and management remains in private hands.
When reminded that some countries like Saudi Arabia and Brazil own majority stakes in their oil companies and they are efficiently managed, Onyegaba said the political system and market environment in Nigeria are different from others, insisting that the best thing to do is to allow private investors to come in.
On the issue between the government and organised labour, over the subsidy removal, Onyeagba lauded the unions for coming out of the Monday meeting they held with the Federal Government with a resolution to suspend the planned nationwide strike.
He said the issue of subsidy on petro has come to a point when it has to stop, given the huge funds spent on it and the impact on government finances.
He said the price hike shouldn’t have happened immediately after the president’s inaugural speech when the subsidy removal was announced, but that was the case because some marketers wanted to make quick gains out of the situation at the expense of the masses.
He noted that the removal will pose difficulties for Nigerians, at least in the interim, but the citizens should be made to understand the long-term benefit of it.
He urged the government to show some level of efficiency and build confidence in Nigerians about their ability to invest the funds being pooled out of subsidy on critical infrastructure that would make a positive impact on the masses.
Victor Ezeja is a passionate journalist with six years of experience writing on economy, politics and energy. He holds a Masters degree in Mass Communication.
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