Buhari signs PIB into law, set to end Subsidy regime.
Written by crest887fm on August 17, 2021
The Federal Government may soon end the fuel subsidy regime with the signing of the Petroleum Industry Bill by the President Muhammadu Buhari on Monday.
It was gathered on Monday that the government’s position of fuel subsidy would form the major item during the Minister of State for Petroleum Resources, Chief Timipre Sylva’s press conference on the petroleum industry law, which holds today (Tuesday).
It was gathered that with the signing of the PIB into law, the cost of petrol could jump to as high as N300 per litre from the current N162-N165 per litre upon the implementation of the law if market forces were allowed to determine the price as stipulated in the new law.
It was learnt that another issue that the minister would address was the unbundling of the Nigerian National Petroleum Corporation.
The Special Adviser to the President on Media and Publicity, Femi Adesina, in a statement on Monday, disclosed that Buhari had signed the PIB.
A top official of the Ministry of Petroleum Resources, who confided in Newsmen on Monday, said, “The minister will at the press conference today Tuesday, explain the government policy direction on fuel subsidy, but if what he said in the past is anything to go by, he may announce a fresh direction on subsidy, which will be removed with the signing of the PIB.”
It would be recalled that Sylva had in July explained that subsidy on Premium Motor Spirit, popularly called petrol, would come to an end once the PIB was signed into law by the President.
Also in June, the Group Managing Director of the NNPC, Mele Kyari, had explained that the price of petrol should be more than the N280 per litre at which Automotive Gas Oil, also known as diesel, was being sold then.
The NNPC boss explained that the difference between the prices of petrol and diesel should be around N10 per litre, with petrol having the higher cost.
Findings in Abuja on Monday showed that diesel was selling for around N290 per litre, meaning that petrol should be selling around N300 per litre, going by Kyari’s explanation.
Meanwhile oil marketers on Monday told newsmen that with the signing of the PIB, subsidy on petrol had effectively ended.
The President, Petroleum Products Retail Outlets Owners’ Association of Nigeria, Billy Gillis-Harry, said, The critical thing for us Them is that the PIB addresses the issue of subsidy removal on petroleum products that has been impacting so negatively on Nigeria’s economy, and as a responsible association, they want support the government, the minister, the NNPC GMD and other Key Stakeholders on the presumed removal because They shouldn’t be spending so much subsidising petroleum products.
When contacted, senior officials of the petroleum ministry stated that the minister would speak on it today (Tuesday).
However, a professor of Petroleum Economics and Policy Research, Wumi Iledare, also told newsmen that the NNPC would not remain the same going by the provisions of the new law.
Iledare said the Act had an investment-friendly fiscal framework with well designed regulatory and governance institutions.
In a letter to the President, the Secretary General, Organisation of Petroleum Exporting Countries, Sanusi Barkindo, said the bill would attract investments to Nigeria.
On his part, the Executive Secretary, Nigeria Extractive Industries Transparency Initiative, Dr Orji Ogbonnaya-Orji, said the new law had ended decades of uncertainty concerning the future of the country’s oil and gas sector.
Also The Speaker of the House of Representatives, Femi Gbajabiamila, said Nigeria’s oil and gas industry would now receive a breath of fresh air and allow investments and transparency to flourish with the coming into being of the Petroleum Industry Act, 2021.
Similarly, the Senate described the assent of the PIB by Buhari as a major victory that had the potential of bailing Nigeria out of its economic predicament, adding that the Act would enable the country to make the most of the economic gains of the industry for the benefit of Nigerians.
Meanwhile, at a public hearing on the 2022-2024 Medium Term Expenditure Framework and Fiscal Strategy Paper organised by the House of Representatives’ Committee on Finance in Abuja, on Monday, the Minister of Finance, Budget and National Planning, Zaniab Ahmed, lamented that Nigeria continued to be exposed to risk aversion in the global capital markets, which would put further pressure on the foreign exchange market, as foreign portfolio investors had yet to return to the Nigerian market.
Ahmed said the situation was compounded by sustained perceptions about the over-valuation of the naira despite recent adjustments by the Central Bank of Nigeria.
In a related development the Pan Niger Delta Forum has said the President’s assent to the PIB despite opposition from various southern groups was a sad day for the people of the Niger Delta region.
The National Publicity Secretary of PANDEF, Ken Robinson, said this in a telephone interview with one of our correspondents on Monday.
Robinson said the action of the President showed insensitivity and disregard towards the feelings of the Niger Delta people.