Adaobi Rhema Oguejiofor
The Senior Special Assistant to President Bola Ahmed Tinubu on Public Affairs, Ajuri Ngelale, has said that establishing more refineries in Nigeria will not result in lower petrol prices.
Ngelale, who stated this during a recent interview with journalists, explained that people often say that if the country’s refineries were working, fuel would be cheap for Nigerians, but nothing could be further from the truth.
In his own words, “that is a myth, it does not happen anywhere in the world, even if we had the most refineries producing the most petrol in the world, you would find that the most prolific petrol producers with their refineries do not charge different from the countries without refineries. I am not saying that we should not have refineries, but there are benefits to having working refineries.
“This is why phase one of our Port Harcourt Refinery is coming on stream in December 2023 and phase two by the end of 2024. Dangote Refinery is already up and is going to start dishing out products very soon. BUA 200,000 bpd Refinery is coming up in Akwa Ibom, we are going to have an excess supply that we can export internationally.”
According to him, the point is that the reason why the price at the pump will not go down irrespective of what Nigeria’s refining capacity is as a country is that nobody spends tens of billions of dollars on building a refinery because of charity or corporate social responsibility, they establish it in order to make money.
Ngelale further argued that no matter the number of oil marketers bringing fuel into the country, the price is still dependent on the price of crude oil in the international market. He added that when crude oil prices are high in the international market, fuel pump prices will automatically be high, but when crude oil prices are low there, fuel pump prices will be low and the market fundamentals apply to every country, not just Nigeria.
The Senior Special Assistant expressed that the benefits of having refineries in the country are not that people will have cheap fuel, but that the country will save hundreds of millions of dollars on transportation and logistics costs that are spent on an annual basis, explaining that money is being spent to bring refined fuel from an international refinery to Nigeria through shipping.