The approval of the sum of $1.5 billion by the Federal Executive Council on Wednesday, March 17, 2021 for the rehabilitation of the Port Harcourt Refinery has been greeted with mixed reactions.
While some have hailed the decision to rehabilitate the ailing refinery, a greater majority of the citizenry have outrightly condemned the approval of such a whopping sum of money.
Some of those against the decision are former Vice President, Atiku Abubakar, Governor of Ekiti State, Kayode Fayemi, who doubles as the chairman of the Nigerian Governors’ Forum and these are men who’s opinions command respect in the polity.
The Minority Caucus in the House of Representatives on Tuesday, March 30, also rejected the approval, describing the figure as “outrageous and heavily inflated” and called for an urgent downward review of the bogus figure.
True, fixing the refinery will, to some extent, help to reduce the fuel supply deficit, reduce amount spent on subsidizing fuel importation as well as reduce the occasional fuel queues being experienced in some parts of the country.
Revamping the refinery would create employment for the teeming youths of the Niger Delta, who are jobless and in addition, increase the country’s refining capacity.
Plausible as the merits of the rehabilitation of the refinery are, the demerits are stronger and by far outweigh the advantages.
To start with, the country’s economy is presently in very bad shape. According to statistics, the nation’s debt profile is about N32.9 trillion, up from N12 trillion, in 2015 when Buhari took over the mantle of leadership. Unemployment is 33%, while inflation is 17%, both are all-time highs.
And, as if to buttress all of these, the country is hoping to sell off some of its national assets to fund the 2021 budget! Things are that bad. What all of these imply is that the country may even be thinking of borrowing to fund it’s quota of the tripartite funding arrangement of the refinery rehabilitation project.
The country’s refineries have been under-performing for year’s now so why is the government choosing to rehabilitate the refinery at this point in time when the nation needs every kobo it can generate? Nigeria’s wobbling economy can ill-afford such a luxury of throwing N720 billion down the drain.
According to reports, the Shell Petroleum Development Company (SPDC) sold its Martinez Refinery in California, USA for $1.2 billion last year. If Shell, that has the wherewithal, is selling off its refinery, why is Nigeria throwing funds down the drain rehabilitating it’s own? Nigeria’s economy is in dire straits right now that calls for utmost prudence with the use of whatever revenue it can generate.
The country’s refineries have been running at a loss for year’s now. So, spending a whopping $1.5 billion or N720 billion on a refinery, with no guarantee that it will function efficiently for even up to a year, does not make economic sense.
Besides, rehabilitating the refinery almost midway into President Muhammadu Buhari’s second tenure looks highly suspicious. The three-phased rehabilitation is expected to be completed long after Buhari’s tenure. What is the guarantee that the next government will continue with the project?
The idea of rehabilitating the refinery should be jettisoned. At best the country should privatise the Port Harvourt Refinery, and the three other, refineries so they can be run more efficiently by private concerns with the necessary wherewithal. In the words of Atiku Abubakar, rehabilitating the Port Harcourt Refinery will amount to funding inefficiency and a huge waste, and we say “No” to such a venture!