The Federal Government said, yesterday, that though the Petroleum Industry Act, PIA, ordered immediate market-driven downstream sector with petroleum products selling at market price, the price of petrol would remain at N162 per litre until the government concludes its ongoing negotiation with labour unions.
Minister of State Petroleum Resources, Chief Timipre Sylva, stated this in Abuja, a day after the PIA was signed into law by President Muhammadu Buhari, explaining that it was the first time a law in Nigeria was specially targeted at the development of oil-bearing communities.
He also explained that in line with the provision of PIA, Nigerian National Petroleum Corporation, NNPC, Limited, would be incorporated by the Ministry of Petroleum Resources and the Ministry of Finance within six months.
Insisting that the three per cent host communities fund in the Act was a fair deal for Niger Delta, Sylva said: “The PIA has actually deregulated the sector but that doesn’t mean that there is going to be an immediate implementation of deregulation.
“We are mindful of the fact that this will bring some hardship and that is why we are not just rushing to implement it. The implementation framework will take care of how we are going to alleviate the suffering that it will bring.
“We will continue to work with labour to ensure that there is a framework that will allow us to implement this provision of the PIA.”
He stressed that it was not completely true the petrol daily consumption was 103 million litres, noting that average consumption was about 52 million litres/day.
He said: “The daily consumption was about 66 million litres/day when we came in and we were able to bring it down to about 52 million that is really the average. But once in a while, you have that flash and spikes that will make consumption go up because of the activities of smugglers.
“Those are not really the regular situation and so we cannot really use that as a measure. The average consumption is 52 million litres daily.’’
On the NNPC, he said: “The PIA has clearly stipulated a time frame within which the new NNPC Limited will be in place. It has given a time frame of six months within which time the Ministry of Petroleum and the Ministry of Finance together will incorporate NNPC Limited.”
That will soon start according to the law that is in place now.
“But as I said, we will wait for Mr President because we don’t want to preempt what he will say on Wednesday (yesterday).’’
On the host communities, the minister said: “A lot of figures have been bandied about as the desirable figure. Some say 10 per cent and there are some extremists who even say 100 per cent, some even say 25 per cent. But what is the philosophy behind the PIA and the times in which we stand?
“Today, we are in the last mile of the oil economy and that is common knowledge to everybody. It means we are in a race to produce as much oil as we can because in the end if global trends overtake us, there will still be oil in the ground but there will be no market for oil. After all, coal didn’t finish in the ground before they moved away from coal.
“So, we are in that race to produce as much oil as we can now. As a country, we have a direction that we are going to. Right now, if you talk about three per cent in the Act, for us in the Niger Delta, I asked them, three per cent of something is that not better than 100 per cent of what you don’t know?
“The philosophy of this Act is to attract investments to Nigeria to produce as much of this crude in the ground as possible. We must measure everything against this philosophy.’’