Timipre Sylva: No refinery in the world can survive a subsidy regime
Timipre Sylva, Nigeria’s Minister of state for petroleum, has explained why the country needs to move away from subsidy on premium methylated spirit (PMS).
Appearing on the Nigerian Television Authority (NTA) on Tuesday, February 1, Sylva stated that “there is nothing on the subsidy matter that had not been questioned”.
The Minister who reacted to co-guest, President of Nigerian Association of Energy Economists (NAEE), Yinka Omorogbe’s comment on the need to investigate how many litres of Premium Motor Spirit (PMS) the country consumes and the differential between the landing cost and subsidy, among others, Sylva noted that the figures fixed for Nigeria’s fuel consumption are inflated.
He said “But we should just sit down and interrogate that subsidy, subsidy price and see what we are paying for it and what’s in the landing costs.
“There have been efforts at controlling smuggling. And then something dramatic happened. When we had the deregulation discussions, and the price moved up to N162 from N145 where I met it, we realised that the consumption dropped to less than 50 million litres or 40 million.
“So, later on, once the exchange rate also now moved up a little bit and swallowed the gains we made from the N162 move, the figures increased again.
“And sometimes, the figures you hear are crazy. I mean, when they tell you 90 million litres a day, I mean, they’re crazy figures. So I mean, so for me, what is the total of all this? We’ve been interrogating these numbers for 20 years.
“We continue to interrogate these figures because we all know that there is a problem here, it’s opaque.
“The opportunity, the premium is not coming to government and it is not going to the poor people. It is going to a select people who are feeding fat on these things.
“So why don’t we just get rid of this thing? Okay, we should interrogate this thing, but I mean, to me, that is not the solution. Why don’t we just get rid of this whole subsidy so that we know that this problem is over once and for all?
“I mean, we agree that the figures are all opaque. We agree. That’s why we are saying look, let’s stop all the shenanigans. Let’s stop all this discussion”
