The quest of one Africa’s biggest oil producers to wean itself off imported fuel has missed at least five deadlines since conception in September 2009, a BusinessDay analysis has revealed.
For the umpteenth time, Nigeria is trying yet again to end massive petrol importation by relying on the Dangote refinery with a capacity of 650,000 barrels per day (bpd) and its state-owned refineries (445,000 bpd) currently under rehabilitation.
“Nigeria will end the importation of petrol by the middle of next year based on expectations that its refineries would be back on stream and the Dangote Refinery would have been running,” Mele Kyari, group chief executive officer of Nigerian National Petroleum Company Limited (NNPC) said in a State House briefing last month.
Dan Kunle, a global energy business advisor with experience working with various energy agencies, said the 2023 cut-off date to exit petrol importation was illogical and unconvincing.
Kunle said the NNPC had done very little to convince Nigerians it was serious about the plan to exit importation.
He said the anticipated 2023 deadline for Dangote looked tentative due to soaring currency risk and global inflationary impact on the cost of materials and engineering.
“Why is the government always putting itself under pressure with endless deadlines it never meets concerning issues like removing subsidies or stopping the importation of petroleum products?” Luqman Agboola, head of energy and infrastructure at Sofidam Capital, said.
Agboola noted that several government officials have made similar pronouncements in the past without any results.
The first government official to pledge Nigeria’s end to petrol importation was a former oil minister, late Rilwanu Lukman.
During the heat of the 2008 global recession, Lukman promised the then government was committed to ending Nigeria’s petrol importation by fixing the chaotic condition of its four state-owned refineries.
“Nigeria would revive earlier plans to privatize the facilities as part of a strategy to wean the country off its dependence on imported fuel,” Lukman told Reuters on February 27, 2009.
In 2012, late President Goodluck Jonathan also assured Nigerians the country was on the path to ending the importation of petroleum products.
“If in the next 10 years, this country is still importing petroleum products, then those of us who have the opportunity to be here when we die, they should write something behind us, saying we did not rule this country well, because we must stop the importation of petroleum products,” Jonathan told State House correspondent in November 2012.
In 2014, Jonathan rehashed Nigeria’s resolve to end the importation of petroleum products by 2017.
“Our projection is based on the 400,000bpd refinery being planned by Alhaji Aliko Dangote, who is investing $9 billion in the green-field project,” he said in 2014.
Before taking office in 2015, President Muhammadu Buhari and his party, the All Progressive Congress, repeatedly criticised past governments for failing to fix the country’s refineries.
When oil prices fell in 2015, the then opposition leader urged the government to “stop stealing from Nigerians and allow them to enjoy the relief that has come to consumers of petroleum products globally.”
In his response to the fuel scarcity in the country in March 2015, Buhari criticised past governments and former president Jonathan for failing to fix refineries and leaving Nigerians at the mercy of fuel imports.
He reminded Nigerians that two of the four refineries in the country were built under his watch as petroleum minister in the 1970s.
“In my time as NNPC chairman and Petroleum Minister in the late 70s, two of our four refineries were built, and domestic consumption catered for. But over the last several years, our refineries have declined, and we are at the mercy of imports,” Buhari said at the time.
Many Nigerians enthusiastically welcomed Buhari’s promise to end Nigeria’s years of fuel imports to allow citizens enjoy reliable supply and pricing.
As president, Buhari appointed himself petroleum minister and seemed ready for the important assignment. He pledged to revitalise the dysfunctional refineries and boost foreign reserves by ending the importation of refined fuel.
On August 4, 2015, Buhari appointed Ibe Kachikwu as the new Group Managing Director of the NNPC. Kachikwu vowed to resign if Nigeria continued to import fuel by 2019.
In the interview, which lasted 23 minutes, Kachikwu promised to deliver on the completion of the refineries, saying he was committed to delivering ending Nigeria’s importation of petroleum products.
“2019 is the target time… I target 2019. If I don’t achieve it, I will walk…I put the date and I will achieve it,” the minister stated during an interview on BBC World Service programme, HardTalk, anchored by Stephen Sackur in 2017.
Crude oil accounts for around 95 percent of outgoing goods trade each year, yet Africa’s largest economy and the most populous nation is dependent on imported petrol, despite never-ending rehabilitation and turnaround maintenance.