The Lagos Chamber of Commerce and Industry (LCCI), has called on the Federal Government to revive and overhaul the local refineries to guard against a reoccurrence of importation of off-spec fuel.
The Chamber also urged the government to eschew politics and consider the economics of refurbishing and maintaining the existing refineries.
LCCI President, Michael Olawale-Cole, who said this in a statement issued on Friday, advised the government to take decisive action on whether to own the refineries or involve the private sector in their management for profitability and sustainability.
He said: “The government may need to consider a joint venture model of the kind with Nigeria Liquefied Natural Gas where the government holds 49% and the private sector 51% for the refineries.
“As at the end of 2020, the NLNG raked in revenue worth $114 billion, paid $9 billion in taxes, and $18 billion in dividends to the federal government.
“This model can be replicated with the refineries. A 100% ownership and management by the government is not advised.”
Olawale-Cole argued that refining crude is the most sustainable solution to fuel importation challenges, especially in view of the recent incidence of the importation of off-spec fuel.
He added that refining crude locally for both domestic consumption and exports would also boost Nigeria’s foreign exchange earnings.
He therefore stressed the need to conduct an extensive and conclusive investigation to unravel the circumstances that led to the compromised importation.
He said the results of the investigation should point to actionable penalties for all parties involved to serve as a deterrent against future occurrences.
We also urge the government to conduct an audit of the current processes towards having a standardised system that meets international best practice.
Olawale-Cole continued: “The news about the importation of contaminated fuel and subsequent recall of the same came to Nigerians as a rude shock, as Nigerians had trusted that there was a fuel importation system that could not be compromised in the manner it happened last week.
“This is disappointing, risky and calls for an immediate overhaul of our import processes and systems to forestall any chance of future occurrence.
“One cannot imagine the danger this portends if it had happened or should happen with aviation fuels for our airlines.
“We also urge the government to conduct an audit of the current processes towards having a standardised system that meets international best practice.”
He equally urged the government to create an enabling environment where private refineries can thrive, a development he said can save Nigeria about N6 trillion yearly from fuel subsidy and associated costs through domestic refining.
The amount represents about 50% of Nigeria’s expenditure (including N2.56 trillion supplementary budget to cover six months fuel subsidy) in the 2022 budget.
