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Published On: Wed, Feb 26th, 2014

NEITI wants Nigeria’s refineries privatised

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The Nigeria Extractive Industries Transparency Initiative (NEITI) in Abuja on Wednesday recommended the privatisation of the country’s refineries.

The NEITI Executive Secretary, Mrs Zainab Ahmed, made the recommendation at the investigative hearing on the alleged connivance of NNPC and Swiss oil companies to defraud Nigeria of billions of dollars.

The hearing was at the instance of the House of Representatives Committee on Petroleum Resources (Upstream).

According to her, the refineries are operating far below their capacities, adding that their operations and overhead costs remained same irrespective of the volume of production.

She said that the 445,000 barrels per day allocation to the refineries should be reviewed to their actual refining capacity.

“As the refineries get older, their performance deteriorates due to the poor maintenance culture in place,’’ she said.

The executive secretary said that because of the inability of the NNPC to utilise its domestic crude allocations, it usually exported them.

Ahmed said that NNPC had agreements with Societe Ivoirenne De Raffinage (SIR) and Nigermed for processing some quantities of the crude oil offshore.

The Executive Secretary said that there was no cost efficiency in the transactions with the offshore processing organisations of SIR and Nigermed.

“When compared with the reported price of PMS (petrol), DPK (kerosene) and AGO (diesel) and the retained products proceeds paid to NNPC it is not economically beneficial,’’ Ahmed said.

She observed that NNPC alternative transactions which amounted to 22 billion dollars, was not disclosed in the corporation’s audited financial statements.

The Chairman of the committee, Rep. Muraina Ajibola (PDP-Oyo), said that CBN would be further invited to shed more light on the issues raised by NEITI. (NAN)

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