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Energy

10 Benefits of Petroleum Subsidy Removal You Must Know

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  1. Infrastructural Development: Frees up public funds for more meaningful infrastructure and developmental program that stimulates industrialization, create jobs, economic growth and social prosperity. For example:

Almost N12 trillion spent on subsidy in the last 4 years is more than sufficient to develop any of the following project:

-2,400, hospitals of 1000 bed capacity across 774 LGA
-or 500,000 new houses to provide shelter to over 3.5 million Nigerians
-or 27GW of electricity generation
-or skill up and provide education up to tertiary levels for over 2 million Nigerians

  1. Grow Domestic Refining: Subsidy removal creates a market reflective downstream which invariably stimulates more downstream investments especially in the domestic refining space, thereby creating more jobs, prosperity and growth.
  2. Reduce Gasoline Smuggling and Diversion: The removal of fuel subsidy eliminates the unhealthy price arbitrage with neighboring countries thereby preventing the diversion and smuggling of gasoline outside the Nations borders which bleeds our economy.
  3. Reduce Corruption: It also reduces corruption surrounding internal product diversion as many marketers procure gasoline at subsidized regulated wholesale prices but still sell at deregulated retail prices.
  4. Resource Rebalancing: The rich benefit more from the subsidy than the poor as they have higher number and capacity of vehicles to buy more gasoline; removal of the subsidy creates an opportunity to redistribute this benefit directly to those who need it more.
  5. Stimulate Responsible Consumption reducing Waste: Waste makes want. Subsidy removal enable responsible gasoline consumption which reduces waste as the prices is more market reflective and the demand for the product will rebalance itself with the new price realities
  6. Grow upstream Production: Subsidy removal allows the full recovery of upstream revenues which enables reinvestment required to grow our national petroleum production and reserves and overall forex earnings.
  7. Strengthen the Naira: Growth of our forex earnings combined with reduction in product consumption reduces pressure on forex thereby strengthening the Naira.
  8. Reduce Product Scarcity: Open market reflective prices, brings in more players, creates a more efficient market thereby reducing fuel scarcity and its adverse effects on the economy.
  9. Reduce Growing Deficit and Public Debt: Subsidy removal reduces the growing and unsustainable Budget deficit and consequently the debt burden creating a more robust economic and sustainable future.

In conclusion, removal of subsidy allows for better use of public funds to achieve more meaningful infrastructural development programmes which will be more beneficial to Nigerians and grow the economy.

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Energy

Fuel Scarcity: Obi asks NNPCL to be transparent, come clean on its operations

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Former Presidential Candidate, Peter Obi, has called on the Nigerian National Petroleum Company Limited (NNPCL) to come clean on its operations amidst the lingering fuel scarcity crisis.

Obi, in a statement, lamented the lack of transparency in NNPCL’s dealings, particularly regarding subsidy payments and fuel imports.
He questioned how a company that declared a N3 trillion profit in 2023 could fail to alleviate the fuel scarcity, citing incompetence and mismanagement.

The Labour Party chieftain urged the federal government to take decisive action, ensuring NNPCL’s operations are transparent and accountable to Nigerians.
He emphasized that the current fuel scarcity has inflicted hardship on citizens, and it’s time for those responsible to be held accountable.

Obi’s call for transparency and accountability is a clarion call for good governance and effective management of the nation’s resources.

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Energy

Dangote promises to raise power generation at the National Grid to boost economy

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By Ahmed Rufa’i, Dutse

The Dangote Group of Companies has promised to boost the power generation at the national grid through increased energy production in the country.

This was contained in a press statement issued by the communication officer in charge of north, Dangote Group of Companies, Malam Jibril Abubakar, said the group general manager of Dangote Sugar Refinery (DSR) Numan in Adamawa state, Mr Bello Abdullahi Dan-Musa.

According to the statement, “The company operates an independent power system, and that excess energy will be redirected to the national grid.”

The statement stated further that “the power, from the Dangote Sugar Refinery, Numan, when redirected to the National Grid has the potential to contribute immensely to the rapid development of the economy of the entire Northeast”.
He added that the energy will bring about accelerated development and industrialization in the region.

“President of the Dangote Group, Aliko Dangote, had said that upon completion of the BIP projects, his sugar company will be able to create about three hundred thousand direct and indirect jobs, with positive multiplier effects on the national economy”.

The Group General manager added that “The Sugar Refinery (DSR) employs no fewer than 7,000 workers yearly in its Backward Integration Project (BIP) in Numan, Adamawa State

“The Dangote Group is Nigeria’s biggest employer of labour after the government.”

Mr. Dan-Musa said most of the employees are often engaged on a temporary basis during the cane production season.

Recently, he said the company paid over N500 million to the out-growers for the sugarcane they produced under the DSR Numan out-growers scheme.

The current capacity of the DSR Numan refinery of 4,800 Tons of Cane Per Day (TCD), he said, is being upgraded to 6,000 TCD by end of 2023, 9,800TCD by 2024 and subsequently to 15,000TCD.

According to Mr. Dan-Musa, Dangote Sugar Refinery Numan has contributed immensely in the realization of the Backward Integration program of the Federal Government.

He added that the company has acquired state of the art machines to support its production process, adding that its facilities are environmentally friendly.

The Group General Manager stated further that “its Backward Integration goal is to become a global force in sugar production, by producing 1.5M MT/PA of refined sugar from locally grown sugar cane for the domestic and export markets”.

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Energy

NNPC lays-off top Management Staff

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The Nigerian National Petroleum Company Limited (NNPC) has layed-off some top management staff who have less than 15 months to retire.

This is coming few days after the oil company announced the removal and replacement of three of the its Executive Vice Presidents (EVPs).

Those affected by the previous shakeup included Abdulkabir Ahmed, who was hitherto in charge of gas, power and new energies; Adokiye Tombomieye, who headed the upstream segment as well as Adeyemi Adetunji, who was in charge of the downstream.

They were replaced by Olalekan Ogunleye as EVP gas, power and new energies; Oritsemeyiwa Eyesan for the company’s upstream operations, while Adedapo Segun took charge of the downstream.

The NNPC, in a terse statement, indicated that the new change in the line up was in line with its aspiration to rejuvenate its workforce.

“In our bid to pursue effective organisational renewal to support the delivery of our strategic business objectives, it has become imperative to rejuvenate our workforce.

“Consequently, in addition to the recent exit of three executive vice presidents, other members of management staff with less than 15 months to statutory retirement will be exiting the company effective 19th September 2023,” the statement said.

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