Nigeria to record zero expenses on fuel subsidy in 2016

Titilayo Ipinjolu

Nigeria’s Minister of State for Petroleum Resources and Group Managing Director of the Nigerian National Petroleum Corporation, Dr. Emmanuel Ibe Kachikwu has said that the novel price modulation mechanism currently in place will ensure that the Federal Government records zero expenses on fuel subsidy in 2016.

Dr Kachikwu stated this while delivering the 45th Convocation Lecture of the University of Nigeria Nsukka under the theme: The Petroleum Industry and the Future of the Nigerian National-Oil Resource Management and the Implication for National Security & Economic Survival.

According to the Minister,  the zero fuel subsidy regime is already in place and will be sustained based on the prevailing modified pricing template for petroleum products which has eliminated extraneous cost elements without necessarily removing subsidy.

“The government will spend zero amounts in subsidy in 2016. This may sound unbelievable to some people but that is part of the change agenda of the present administration of President Muhammadu Buhari“ he said .

He added that large chunks of vandalised pipelines are being recovered and this will supply more crude to the refineries.

The Minister said that despite the difficulties of yester-years the oil and gas industry in Nigeria is ready for greater achievements in the months and years ahead as a result of landmark reforms being implemented by the present administration.

On the ongoing oil and gas reform agenda, Dr Kachikwu listed increasing revenue for the country through sales of petroleum and petroleum products and taxes on profitable enterprises, maximising value added on the crude oil and gas to establish linkages with other sectors through local processing and establishment of gas based industries to stimulate economic growth and development and provide employment opportunities for Nigerians.

“Significant improvement in governance macro economic and fiscal policies are key to harnessing oil and gas resources for the sustainable development of Nigeria through enshrining transparency and accountability, empowering good governance and transparency in expenditure and revenue management,’’ he said.

Dr Kachikwu also noted that the ongoing reform is designed to create competitive framework for public private partnerships anchored on durable financial investments.

The minister expressed appreciation to the Management of UNN for the opportunity given to him to deliver the convocation lecture, adding that “as an alumni of the university he would continue to contribute his quota to the growth and development of the University. “Whatever I am today, UNN contributed immensely to it”

In his remarks the Vice-chancellor of UNN, Prof Benjamin Ozumba said the 45th convocation lecture was unique because the lecture was delivered by an expert in petroleum industry who had within a record time transformed the oil sector.

He Described Dr. Kachikwu as the pride and beacon of UNN, adding that “the University is glad to welcome a super lion and one of the profound thinkers in Nigeria”