Former Vice President Atiku Abubakar has kicked against the federal government’s plan to spend the sum of $1.5 billion to rehabilitate the Port Harcourt refinery, Rivers state.
According to Naija News; the Federal Executive Council had on Wednesday announced the approval of the sum of $1.5 billion for the rehabilitation of the Port Harcourt refinery.
The Minister of State for Petroleum Resources, Timipre Sylva, had made this known to State House correspondents at the end of the FEC meeting at the Presidential Villa.
Sylva said the Ministry of Petroleum Resources had presented a proposal to the council presided over by Buhari to rehabilitate the refinery.
The minister announced that the rehabilitation of the refinery will commence in three phases, adding that the first phase is to be completed in 18 months, which will take the refinery to a production of 90 percent of its nameplate capacity.
Sylva noted that the second phase is to be completed in 24 months and all the final stage will be completed in 44 months and consultations are approved.
Reacting in a post on Twitter, Atiku said that a more valuable refinery of the same size as that of Port Harcourt was sold for less by Shell Petroleum Development Company of Nigeria (SPDC), asking if due diligence was performed before the approval of the fund.
He said: “$1.5 billion to renovate the Port Harcourt refinery is suspicious at the least.
“Moreover, the cost appears prohibitive. Too prohibitive, especially as Shell Petroleum Development Company last year sold its Martinez Refinery in California, USA, which is of a similar size as the Port Harcourt refinery, for $1.2 billion. We must bear in mind that the Shell Martinez Refinery is more profitable than the Port Harcourt Refinery.
“Given this discrepancy, might we ask if there was a public tender before this cost was announced? Was due diligence performed? Because we are certainly not getting value for money. Not by a long stretch.”
“That Nigeria’s economy is in dire straits is a fact well known both to the nation and to our international partners. Unemployment has just reached an all-time high of 33%, while inflation has hit another record high of 17%.
“At this critical period, we must as a nation be prudent with the use of whatever revenue we can generate, and even if we must borrow, we must do so with the utmost responsibility and discipline.
“To therefore budget the sum of $1.5 billion to renovate or turn around the Port Harcourt Refinery would appear to be an unwise use of scarce funds at this critical juncture for an assortment of reasons.
“First of all, our refineries have been loss-making for multiple years, and indeed, it is questionable wisdom to throw good money after bad. At other times, I have counselled that the best course of action would be to privatise our refineries to be run more effectively and efficiently.
“We cannot as a nation expect to make economic progress if we continue to fund inefficiency, and we are going too deep into the debt trap for unnecessarily overpriced projects,” Atiku added.