Minister of State for Petroleum Resources, Dr Ibe Kachikwu, says it is cheaper for Nigeria to import petrol its uses than producing it in the country’s refineries at the moment.
Kachikwu made this known while addressing journalists in Abuja.
According to him, until the upgrade and total refurbishment of the refineries are concluded, as well as ensuring that the pipelines are fixed, it would be uneconomic and very expensive to locally refine the Premium Motor Spirit, commonly called petrol.
He said even if the current set of refineries were working on a 100 per cent basis, they would only be able to account for 20 million litres of PMS per day, about 50 per cent of the country’s total consumption, which he said would make Nigeria still resort to importation to meet up with the shortfall.
The Minister explained that “most modern refineries are configured in such a way that your stock of PMS outage is a lot higher, 70 to 80 per cent. So when we do import the product, we actually save money; we get it less expensive than when we do it here.”
He further pointed out that “the reality is that until we have alternatives in terms of co-locative refineries which we are looking at; until we finish the total refurbishment to improve and upgrade the refineries, it does not make sense to use it with some of the deficiencies.”
According to Kachikwu, “this is because distribution is key.”
He further explained that, “If you have product in Kaduna for example, pumping into the north becomes easy as opposed to moving, as we do whenever we have a crisis, trucks all the way from Lagos and Oghara, out to the north.”
“The way the refineries are configured right now, and until a full set of repairs and TAM are done, they are configured on the basis of 50 per cent of PMS and 50 per cent other products.
“So even if they were producing on a 100 per cent basis, which they are nowhere near producing right now, PMS output would be less than 20 million litres. Our consumption is closer to 40 million. So we will still have, literarily, 50 per cent gap,” he posited.