Worried by the silence and non- commencement of construction works on the greenfield refineries earlier announced for Kogi, Bayelsa, and Lagos States, BudgIT has demanded from the federal government, reasons for the abandonment of the projects which feasibility studies had already been fully paid for and completed.
BudgIT, a civic technology organization at the forefront of raising the standards of transparency, citizen engagement and accountability probe was on the heel of the proposal by the Nigerian National Petroleum Corporation (NNPC) to construct two new 100,000 bpdgreenfield refineries in Delta and Imo States.
Gabriel Okeowo, BudgIT’s Principal Lead in a statement noted that such act of abandoning projects with huge capital outlay after preliminary payments had been made was a waste of resources.
According to the statement by Niyi Soleye, BudgIT Communication Lead, “It is wrong for any government institution to tease citizens with announcements for greenfield crude oil refineries, award huge sums for feasibility studies, abandon the project when it’s time for construction, then repeat the cycle in another state. What guarantees do citizens have that taxpayers’ money earmarked for the refineries in Imo and Delta state will not suffer the same fate as those spent on Kogi and Bayelsa States? What are the lessons learnt from Kogi, Bayelsa, and Lagos greenfield projects? Can these lessons be made public?”
NNPC currently exports a large portion of the 445,000bpd of crude oil allocated to domestic refineries through Crude Oil Lifting contracts (COL) and it is expected that the new greenfield projects would fill up the void and increase domestic refinery.
However, failure of the corporation to make existing refineries work despite monies spent on turn around maintenance in addition to its inability to complete and put the new greenfield refineries to use are currently heightening concerns.
In the past, NNPC has been accused of carrying out its export of unused Domestic Crude Allocation (DCA) through politically-connected middlemen – many of whom do not have adequate capacity to handle the volume of crude oil in their Crude Oil Lifting contracts but simply extract rent and pass the contract on to those who do.
To reverse this, the Minister of State for Petroleum Resources, Dr Ibe Kachikwu during his tenure as the GMD for NNPC cut out the rent-seeking middle men in the Crude Oil Lifting contracts and also to cut down the number of contractors to 16.
This, according to Okeowo had since been reversed and numbers of contractors doubled by 2018.
“At the inception of this administration, the government made some effort to cut out middlemen in the award of Crude Oil Lifting (COL) contracts. We observed a drop in the number of COL contractors from about 43 in 2014 to 27 in 2015 and then to 21 in 2016. However, their numbers grew to 39 in 2017 and to 50 in 2018. Citizens need to pay close attention especially as a part of the Diezani scandal was rooted in the activities of some briefcase companies who got Crude Oil Lifting (COL) contracts.”
BudgIT hence calls on citizens, civil societies, journalists, and media influencers to #AskQuestions about Nigeria’s greenfield refineries every step of the way.
In addition, the transparency organisation also calls on NNPC to do a weekly or monthly briefing to citizens specifically on progress and challenges of its greenfield projects as failure of greenfield refineries to see the light of day opens up many complex loopholes for corruption in the long term.
BudgIT commended the NNPC for publishing its monthly Financial and Operations Report online since the inception of this administration. Such monthly reporting is worthy of emulation by other government agencies in the sector but expressed concerns on the time lag involved in making these reports available.
“As at October 30th, its report for the last four months (June – September) are not yet available online” Okeowo noted.
BudgIT calls on all political parties not to weaponize data concerning the oil and gas industry in the run up to May 2019 elections, but use data as a tool for dialogue to seek long lasting reforms. Many problems in the oil and gas sector are complex in nature and have defied solutions across multiple governments. To be blind to this reality is to walk unprotected into a clouded minefield set up by vested interests that have defied multiple administrations. Let’s focus on the real issues. #StayWoke and #AskQuestions.
Comments are closed.