HUGE REVENUES, EMPTY COFFERS: Where Is Nigeria’s Oil Money?
By Olusola Ajiboye.
Nigeria’s Oil Sector is more of a nightmare than a wealth spinner.
No thanks to an oil Mafia, whose cartel driven activities, (spanning more than four (4) decades) have turned the sector into a huge debris of debts and insolvency.
This is contrary to the expectations of optimists who, at the initial stage of oil discovery (at Oloibiri in present day Bayelsa State) and its commercial revenue-value capacity shortly after, believed that Nigeria’s leadership in Africa and as a Nation of promise in global economic algorithim was a matter of time.
Yes! the stage for such optimism did exist but what was overlooked was finding the right minds to make it possible of attainment. Mismanagement of Nigeria’s Oil wealth during the boom period, coated in unproductive ventures and corruption went unabated because Nigerian Rulers believed the fortunes would not cease. But the results then and now show that is high-falutin optimism.
Please don’t second guess this writer.
Nigeria’s economic quagmire is not resource scarcity because the oil-wells are still wet. Resource management is the bane.
An estimated thirty seven point one (37.1) billion barrels of crude oil and two hundred and fifteen (215) trillion cubic feet of gas deposits place Nigeria as the largest oil producer in Africa and tenth (10th) largest crude oil exporter in the world. A Nation sitting on such prized resources is like a coveted bride with high bargaining power among many suitors.
The Nineteen Seventies (1970s) oil boom with billions in dollar sales attracted a flurry of foreign-oil exploration had positioned Nigeria for great impact on the global economic order. There were opportunities for diversification in petrochemicals, manufacturing, transportation, aviation, agriculture, environmental rejuvenation and infrastructure. Investments in all these economic components were feasible because billions of dollars were generated from crude oil exports. Unfortunately remittances to government coffers did not add up and raised accountability questions.
This has become a recurring decimal among oil industry players over the years with focus on succeeding managements of Nigeria National Petroleum Corporation (NNPC).
The discourse has centred on questionable expenditures, discrepancies in accounting procedures, thefts and high profile impunity, which have turned NNPC into a mafia-stronghold that exists to service the interests of people opposed to the interest of the Nation.
Oil watchers often describe Nigeria’s Oil Sector as a Ghost-import system.
Every measure inclusive of the Petroleum Industry Act (PIA) taken to sanitise the sector has been side-tracked. Neither the NNPC nor its unbundling agencies have responded to the needs of the Country. Re-designation of the agencies as private driven commercial entities have failed. Rather than wealth creators, NNPC and its subsidiaries are robbing Peter to pay Paul.
The Peter in this context is the Impoverished citizen while Paul is the Oil-Mafia.
Courtesy of the Oil-Mafia, the Ghost importing system is serviced to the tune of twenty four (24) Million Naira daily. Arguments on the vexacious oil subsidy removal cannot be treated in isolation of the graft around it.
For decades, oil subsidy has funneled hundreds of millions, in local and foreign currency denominations into private pockets.
It is a story of a big oil-heist unleashed on an otherwise promising Nation. The loot has gone unchecked because NNPC officials in cahoot with unscrupulous oil Barons with long-powerful connections in government, stand between oil sector reforms and Nigeria’s economic development agenda.
Nigeria is the only oil producing Nation in the world without a functioning Refinery. Her four (4) Refineries have crumbled under the weight of deliberate sabotage by oil Mafia within and outside the Nigeria National Petroleum Corporation. Each succeeding government is a witness to the sleaze.
As the baton is passed from one NNPC management to the other, the language remains the same: FRAUD! Oil subsidy is a citizens’ right of benefit from God given resources deposited in the territorial and land borders of their countries but for Nigerians, It is a different ball game. Oil money did not only make them poorer but ranked their country as the world poverty capital.
Subsidy has bred various actors in the oil sector in competition for different sizes of the cake because a ghost-payment system that thrives on shady practices makes billionaires of a few oil importers who import nothing. Many incidences have exposed high level impunity and graft in subsidy payments with ordinary Nigerians as victims.
On the13th of January 2011, a cargo-ship M. T. Emerald, claimed to have offloaded fifteen (15,000) Thousand metric tons of Premium Motor Spirit (PMS) at one of Nigeria’s sea ports and got a whooping one point four (N1.4) billion Naira as subsidy payment. Meanwhile, investigations reveal that no single litre of fuel was imported.
The “Importer” in filthy collaboration with corrupt NNPC officials obtained a bill of Laden, a Navy clearance certificate and a Habour Master signature to pull the heist and smiled to the bank with monies meant to fix the lives of millions of Nigerians.
While Nigerians were being robbed, the faceless cargo ship that claimed to have berthed at Nigeria’s seaport was three thousand (3,000) miles away from the Country’s territorial waters. This, among others, is just a tip of the ice-berg.
In 2011, subsidy payment per day angled at fifty nine (59) Million Litres but thirty five (35) Million litres were recorded. What happened to the twenty four (24) Million litres shortfall?
Each misdemeanor, each loot and each brazen act of impunity against Nigeria by the Oil-Mafia sink Nigerians into the abyss of want misery and under-development. Too sad for a country with the Bonny Light Bent, the most prized crude-oil in the world.
Oil subsidy scam is not an error but an entrenched fraud, insulated from prosecution by criminal oil marketing Barons.
Subsidy in simple arithmetics is the differentials between cost of importation and domestic production cost.
So if Nigeria paid for fifty nine (59) million litres of PMS per day but thirty five (35) million went unaccounted for, there’s no second guessing that the loot went into Ghost Importers’ accounts. Persistent shaddy practices in the country’s oil-sector continue to make patriots despondent about the future of unborn generations due to the failure of institutions to clean the rot.
The judiciary, by a recent judgment in Abuja is also emasculated by a tenacious siege of the Mafia which granted an open-season to make the Country a dumping ground of imported petroleum products.
The judgement ignored a pending suit to challenge importation of refined crude by Dangote Refinery which has not hidden its capacity to meet domestic production and exportation of refined crude oil.Oil subsidy is gone’ is the most courageous statement ever made by a Nigerian Ruler since Independence.
It is targeted at changing the negative narrative of a country seized by oil-cabal which exploits institutional failures to launch a big-heist on her citizens.
This unenviable narrative is not due to absence of reforms but the capitulation of handlers and resource managers to cartel-driven manipulation.
The oil-Mafia knows that an oil-rich Nation is addressed as such, if its Refineries are in order and does not need to import what it can produce.
But the Mafia ensures that every strategic reform policy articulated in the Petroleum Industrial Act (PAC) is rendered ineffectual.
It also ensures that every move to restore the moribund NNPC either through serial Turn Around Maintenance (TAM) or unbundling into subsidiaries fail.
Instead of responding to reforms, the Nigeria oil sector is a sick patient who defies multi-medical expert diagnosis and treatment.
It is unlikely if the institutional decay will go as long as the NNPCL places premium on activities that make Nigeria oil Industry perpetually import dependent.
Import license approvals rose from five (5) to one hundred and twenty eight (128) between 2006 and 2011. This high figure speaks consumption than production.
It exposed Nigeria’s major revenue source to a deluge of fake and fraudulent importers besides creating entries to non-energy experts and emergency contractors.
Round tripping is the long term result of these unwholesome conducts which leaves Nigeria hay and dry.
No thanks to Ghost Importers who have turned Lome and Cotonu into a hub of smuggled or stolen petroleum products from Nigeria.
With the recent Abuja court ruling, it is an open season again for oil importers.
Oil Subsidy was meant to provide access for Nigerians to benefit from their God-given resources but subsidy scam has bled the citizens to their bones. President Tinubu ‘Subsidy is gone’ inauguration declaration should be analyzed outside its extemporaneous.
It is a statement that was adequate to the dire straits the country found itself. We either take a detour and live, or tread the same route and perish.
But Nigerians must not be compelled to atone for the sins of a few because they have paid a steep enough price to keep the country alive.The writer’s advice to bring back Advocates and Defenders of Oil. Subsidy removal is to consider the interests of the two hundred and fifty (250) million Nigerians directly exposed to the excruciating pains of subsidy removal. Those canvassing oil subsidy restoration should de-emphasise political theories and support their arguments with facts, figures/data, empirical enough to push their postulations, while defenders of oil subsidy removal must advance grounds that provide succor for a citizenry in anguish, awaiting the day of restoration for their country.
Olusola Ajiboye is a Veteran Journalist and Media Consultant based in Osogbo, South West Nigeria.