Why FG Should Privatise Kaduna, Warri Refineries, Invest In CNG-PETROAN

The New Diplomat
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By Kolawole Ojebisi

The Petroleum Products Retail Outlets Owners of Nigeria, (PETROAN), has advised the Federal Government to private government-owmed refineries.

PETROAN, which is an association of oil workers, specifically asked for the privatisation of the 125,000 barrels per day Warri and Kaduna refineries.

Speaking on the benefits of such move, the oil marketers said it would encourage competition, enhance transparency and accountability, and help raise revenue to invest in infrastructure that would improve operations in the downstream sector of the petroleum industry.

PETROAN also called on the government to enforce local content development, enhance the effectiveness of Compressed Natural Gas in 2025, and tackle petroleum products smuggling.

The traders further urged the government to prioritise access to crude oil and provide an N100bn grant to rescue 10,000 businesses affected by subsidy removal.

PETROAN made the call in its 2024 retrospect and outlook for 2025 document released on Saturday in Abuja.

The report was signed by its National President, Dr Billy Gillis-Harry, National Secretary, Barr Adedibu Aderibigbe, and National Public Relations Officer, Dr Joseph Obele.

PETROAN listed its recommendations to consolidate gains in the downstream sector, stressing that privatisation will improve efficiency and limit government spending.

The document read, “Based on PETROAN’s observations, the following recommendations are made to ensure the effectiveness and efficiency of the downstream sector in 2025:

“Privatisation of Nigerian-Owned Refineries: To improve efficiency and reduce government spending, Nigerian-owned refineries, such as the Warri and Kaduna refineries, should be privatised to reputable private companies.

“Foster a competitive market by encouraging new entrants and promoting a level playing field to prevent monopolies and ensure fair pricing.

“Establish a robust monitoring and evaluation framework to track the performance of downstream operators and ensure compliance with regulatory requirements.

“Continue to invest in critical infrastructure and preventive maintenance, such as refineries, pipelines, and storage facilities, to improve the country’s refining capacity and reduce reliance on imported petroleum products.

“Encourage the development of local content by supporting indigenous companies and providing incentives for research and development in the downstream sector.

“Private sector participation should be encouraged to increase access to funding and expertise. Regulatory frameworks should be reviewed to reduce operational costs and attract investment. Stakeholder engagement and awareness campaigns should be intensified to promote the adoption of CNG.

“Collaborate with neighbouring countries to strengthen border security and prevent smuggling, and also utilise digital tracking systems to monitor petroleum products from refineries to retail outlets.”

The document added that, “To boost Nigeria’s refining capacity and reduce reliance on imported petroleum products, we strongly recommend that crude oil be made available for local refineries.

“This strategic move will positively impact the country’s economy and energy security. By prioritising local refineries’ access to crude oil, Nigeria can unlock the full potential of its refining sector, drive economic growth, and enhance energy security.

“PETROAN requests a grant of N100bn from President Bola Tinubu to help prevent the closure of 10,000 marketers’ businesses. The request is in response to the threat of job losses that would result from the removal of the fuel subsidy.”

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