How To Fix The Rot In The Petroleum Sector - NUPENG

While in an interview with Naij.com, Tokunbo Korodo is the Chairman, Nigerian Union of Petroleum and Natural Gas (NUPENG), Lagos Zone.

He explained the real issues between the oil marketers and the federal government; how to tackle pipeline vandalism and reposition oil and gas industry in Nigeria

The disagreement between major oil marketers and the federal government has been of great concern. It has held the whole country to ransom with the scarcity of petrol. What is the bone of contention?
Many people believe or attribute the fuel scarcity to NUPENG being on strike but the real issue has to deal with the disagreement between the major oil marketers and the federal government over the differences in subsidy payment. The marketers believe they have done their part by importing fuel for the usage of the masses and that government should redeem their pledges.

This has been on for a while now and due to inability of the government to pay, the marketers have closed down their facilities; failed to dispense fuel and disallowed tankers from loading. As if that is not enough, they also were unable to pay the truck owners; members of the National Association of Road Transport Owners, NARTO for their freights. Hence, they withdrew their tankers/ services.

According to the Minister of Finance, Dr. Okonjo Iweala, the marketers were said to have been paid about N156 billion while they still claim they are being owed about N220 billion. Can you clarify this?
I’m aware. Even the minister confirmed they were paid some amount of money. We initially thought they weren’t paid any money because nobody said anything until the minister clarified and stated that about N156 billion would be released to them. She paid this as part payment while the marketers feel there still an outstanding bill of N200b to be settled.

They agreed the balance will be paid after 10 days. The 10-day ultimatum ended and they were not paid. I was opportune to be in a meeting with them when the Lagos state government called us for a stakeholders’ meeting. They said the issue is yet to be addressed. Nobody should be blamed or any other organization for the crisis. The real issue is between the marketers and the federal government.

What is your view about the fuel subsidy policy of the federal government?
Before now, we thought the out-going government would be sincere. So we took a stand until recently that we had to change our position.

The stand is we don’t support the withdrawal of petrol subsidy and the deregulation of the sector because this kind of deregulation will create a serious problem for us. We don’t support deregulation that is import-driven for Nigerians. It will not benefit Nigerians. 

People in the business of importing fuels into the country will not allow the refineries work. If we are to have any sympathy for subsidy to be withdrawn or deregulation of the sector, it will be based on local production and there won’t be any excuses for the refineries not working. If well upgraded, the refinery in Warri can produce up to 70 per cent. 

But now in comatose due to lack of crude oil and the same crude oil is being exported by marketers. So people who are in the business of exporting crude oil or importing fuel will never allow the product refined locally. There is lack of political will on the part of the government. Who are the importers? Are they not the political associates of the same government? People that financed their campaigns and their history unknown.

By all indications, the President-elect has shown he is not interested in the petrol subsidy policy. What will be the implications if he succeeds?
The incoming government should be ready to be on side of Nigerians. These cabals would bring in fuel and dictate the selling price. They are so influential that they can form a click or if they are broke, they can just fix prices of petrol. I think the in-coming government should have regulatory body that will regulate the price. But if you are talking about regulating the price, you are still talking about subsidy. It’s going to be a tough time for Nigerians but if the importers are very sincere, then there is no cause for alarm.

Nigerians expect so much from the incoming government, what do you think Buhari can do to solve these problems and fix the rot in Nigerian oil and gas industry?
Personally, I believe that Buhari can turn things around. To the stakeholders in the industry, the PDP administration in the last 16 years is a disaster. We cannot pin-point what they have achieved instead they pauperize the country. Thank God, Buhari was part of the people that facilitated building of the refineries we have in Nigeria.

I expect him to holistically look at the industry, probe whoever is defaulting. He should visit the refineries and he would be chocked nothing has been done since he left as minister of petroleum. For him to have overseen the building of the refineries, it means he meant well for Nigerians. He can still turn things around in the sector. Corruption is at the top gear in the industry and this is killing the industry in a greater proportion. 

We want state of emergency declared in the oil sector. Before, you can be very proud to say you an oil worker but now the reverse is the case. The politicians have hijacked everything. No regular employment in the industry again. It is casualization of workers. And who are the contractors? The same political parties and affiliates of the same party. The legislators would try to sponsor bill work against casualitsation and nobody is giving a listening ear and it has been a free-for-all.

If Buhari scraps the policy the moment he takes over, what do you think would be the pains and the gains?
Nigerians need to understand the pain. Government alone cannot handle the importation of oil. NNPC lacks the capacity to dispense fuel brought in and that is why they make use of the facilities of these private tank farms owners.

This also explains why and how they hold the government to ransom. For the past 16 years, majority of the PPMC depots across the country have not been functioning. Is not that the depot cannot be fixed; to pump petrol into the depot is a problem. Activities of vandals have forced the government to abandon these gigantic investments. 

I keep wondering how vandals would be more powerful than Nigerian government. We have all the security agencies to protect the pipelines and if they can’t do that, how can they protect other valuable products?. The tanker should see in Lagos are not based in Lagos. If the depots in their various states are working, there is no point travelling to congest Lagos. 

Because nobody is listening to them, nobody is making move to solve their problems, they kept on travelling to Lagos to lift fuel. If the IG can give instruction to the CPs in the areas where there are pipelines; that they will be held responsible for any vandal, they will sit up. While the Commissioners of Police past same instruction to the Area Commanders down to the DPOs. They are not doing what they ought to do and that is why we are in this mess.

Recently, President Jonathan awarded a contract to the Oodua People’s Congress; a whooping sum of N9 billion to secure the pipelines across the country. Do you feel this will be productive?
To me, that is another way to defraud Nigerians. Why did he award that contract close to the expiration of his tenure? Where were these people or the idea before now? Why can’t they think of that in the last 16 years of PDP administration? Before the emergence of the PDP government, it has been a standing order that the local chiefs in areas where they are pipelines would be in charge of surveillance of those pipelines.

They were the ones paid to do the job but because they refused to pay them as at when due, they also abandoned the job, giving rise to the vandalisation. If government feels they don’t need the services of these local chiefs, they have security agencies in the country that can take care of that. So no short-cut. NNPC depot must work in full capacity before we can enjoy adequate supply of petrol. 

The private tank farm owners are capitalist who are in business to make money. If government still believes in them or use them, they will continue to hold them to ransom. Let government facilities work at maximum capacity while they can complement. They hold them to ransom because they feel there is no alternative.

Nigerians expect change as soon as Buhari takes over. But he is not a magician because to right the wrong will take long time. Do you think Nigerians will be willing to pay the price?
Nigerians need to be patient for the rot in the sector to be fixed. The man has a good intention. Things have been destroyed beyond redemption but god will give him wisdom to restore the past glory.

Four years are enough to make change and if nothing is done, I’m sure Nigerians will take no excuse. Nigerians are wiser now, they are well determined than ever.

The seventh National Assembly has foot-dragged the passage of the Petroleum Industry Bill, PIB. Do you think the bill will still be passed?

I have lost confidence in the outgoing members of the National assembly in passing the bill because they have failed us. This issue has taken many months and years. 

They have different versions of the PIB, held series of symposium; we presented our version, they did’nt do anything. Now they appear serious about it at the verge of their exit. We don’t want them to pass anything that will create additional problem for the next government or national assembly.