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HomeTop NewsNigeria pays subsidy on fuel consumption by neighbouring countries, says Sylva

Nigeria pays subsidy on fuel consumption by neighbouring countries, says Sylva

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The bulk of Premium Motor Spirit (PMS) also known as petrol find it way into some of the country’s neighbours, making it difficult to know the exact volume of fuel consume locally, according to the Minister of State for Petroleum Resources, Timipre Sylva.

Sylva, in an interview with his media team, said that the Nigerian National Petroleum Company Limited (NNPCL) had also agreed that Nigeria could not tell the exact amount of petrol consumed across the country daily.

Asked to react to the N3 trillion fuel subsidy proposal by the NNPC, amid concerns about the country’s PMS consumption figure, Sylva replied, “I would have preferred that this question be directed to the NNPC.

“I have made my views known about this issue in the past. NNPC has agreed with me that they are not certain about the exact consumption figure.”

He said the truth was that if the country’s petroleum products were smuggled outside the country, nobody could say what volume was involved today, tomorrow or next week, adding that NNPC could not say they know these figures.

“It’s more or less fueling a criminal economy. The NNPC imports the products, and nobody knows the exact destination of the products at the end of the day,” Sylva stated.

“The imported products come to Nigeria, and from there filters out of our borders to neighbouring countries.

“So, as a country, we cannot tell the exact volume of petroleum products that we consume on a daily basis. All we have been doing is to assume the level of consumption over a period and work with that,” the minister said.

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“I have said this publicly before that I don’t know the figure. When I assumed office, initially I was told that our daily consumption was 66 million litres.

“Then, when fuel prices increased from N145 to N162, the consumption figure temporarily fell to about 40 something million litres per day, because the arbitrage opportunity reduced,” Sylva stated.

“Then the value of the naira dropped again, and the number went up again to over 60 million litres. I am told the figure sometimes rise to as high as 90 or over 100 million litres. I don’t know how that happens.

“At this rate, I have said if anyone is looking at a criminal enterprise, look no further than the fuel subsidy,”

This, the minister said, was why he had continued to advocate the removal of fuel subsidy from the country’s PMS pricing template and deregulate.

He said President Muhammadu Buhari had done everything to resolve the issue, including the closure of the country’s borders with neighbouring countries, yet the criminality was not stopped.

“The truth is that what the President could do was to close the ‘formal’ borders. What about the illegal routes?” Sylva asked.

On what could be done, the minister said if the subsidy component was taken out through deregulation, smuggling of PMS to neighbouring nations would cease.

“Of course, we need the market from there. But now we are punishing ourselves because every litre we import at our expense will always find its way outside the country.

“Now, the government is trying to subsidise our citizens so that our people will at least get the benefit of the subsidy on petroleum products.

“But, now because of how our borders are, it is very difficult. Now, we are inadvertently subsidising the whole of Africa. This is the thing we cannot handle,” Sylva said.

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