Alhaji Umaru Dembo was Minister of State for Petroleum Resources during the reign of General Sani Abacha as Nigeria’s Head of State. He speaks on the state of the Nigerian oil and gas industry, challenges and prospects, with respect to the nation’s refineries, petrol subsidy regime, economic impact, as well as insecurity in oil-producing communities and the integrity of oil and gas installations, among others, in this interview with YANGE IKYAA. Excerpts:
During the time of General Sani Abacha when you were Minister, the oil and gas sector contributed a lot to infrastructure development of the country through what was known as the Petroleum Trust Fund (PTF) headed by Maj-Gen. Muhammadu Buhari (Rtd). So, looking back to where you left this sector, are you satisfied with the pace of development of this sector since you left office over 20 years ago?
Well, satisfaction beholds in the eyes of the generality of the people in the country and, also, it is a matter of management of the resources that God has given us in this land. But, as far as I am concerned, there are areas of goodness and there are areas one would say of failure. How the failures came about, I am not in a position to know and we can only comment on activities that are good as to what we facially see since we are not on the authority table.
For instance, I have been there since the time of Gen. Sani Abacha and there have been other presidents also in-between and there is a mixture of administrations; Gen. Abubakar came in and President Obasanjo, then Yar’Adua and, then, Goodluck Jonathan, and now President Buhari. So, it is a long way and there have been several drivers of the activities of the nation and also the activities of the oil and gas industry and whatever God has endowed Nigeria with and how we managed it.
What have you been proud of in terms of the achievements or contributions coming from the oil and gas sector in Nigeria since you left office?
I think that what has happened during the reign of President Buhari has been remarkable; there are no queues during the Sallah or any break. It is very impressive because these are some of the problems that Nigeria was having despite the fact that there has been no improvement or answer to the question of refineries. One of my disappointments too is that all the past governments could not get our refineries working anymore.
I remember that the late Abacha and his ministers, myself and Dan Etete, were arranging to bring the people who did the engineering work in establishing the four refineries that we have in the country; two in Port Harcourt, one in Warri and one in Kaduna, so that we can get the turnaround maintenance really done. Unfortunately, he died before that could happen, and up till now, our refineries are not working, and that is one of my major disappointments.
If I may ask, is it impossible to make these refineries work like in other places and cases, such as the Saudi Aramco, whose refineries are working at home, even as they have ownership of one other refinery in the United States of America from where refined products are imported into Africa and even into Nigeria. Why is it possible elsewhere and why is it seemingly impossible in our own case?
Well, it’s simple; it is the attitude of the leaders of the industry or the leaders of the state itself, because if the state and the presidents in the past were working and thinking about it, there wouldn’t be any problem for us to have our refineries work, not only here but even outside Nigeria; it’s the attitude of the leaders and those around them. I can assure you that even when the late Abacha was trying to get this turnaround maintenance really done very well, some people around him were trying to make sure that it did not happen, they were trying to play games.
I wish he lived to have seen because I was one of those he asked to take the mantle of getting the refineries done and he said go and get those from Japan who originally did the Kaduna Refinery, and we would have done it. But if the leaders or presidents don’t put their feet down to ensure that things that need to be done in our country are done, then it won’t happen.
There are some people in Nigeria who are in the oil sector and every sector, people who are not serious, who don’t love the country enough but love themselves more, or hate the country or even if they don’t hate the country, they choose to cheat the nation by allowing our own money and whatever resources we have to go into other countries than to have the nation achieve its own goals.
We know very well about the contributions of the petroleum industry to different sectors of the nation’s economy during your time as Minister and when General Sani Abacha was in power, with the PTF contributing significantly to infrastructure development. Which of these contributions can you say is the most important of your achievements when you were there?
I think they were all very important, it is not a question of which one among them but you have to put them together because they were together, done by the same government of General Sani Abacha. I know the National Hospital, which everybody knows that without it, Abuja would have been with no particular government-contributed hospital that is equipped with everything that is needed. Although I don’t know how it is now, it is still functioning, but I think it could have been maintained more and better.
Also, the PTF that you mentioned, its work has been everywhere. Even now, you still find transport vessels, medical facilities, roads, and so many other things that were done, and it was General Buhari, who is now President, that headed PTF. I can remember that time that I was appointed Minister, he wrote me a letter of congratulations. The Central Bank building was also done by General Abacha and there are so many other edifices. During that time, he made sure that even the local matter of federal character was considered so that people can come from all over the country and be able to enjoy a sense of belonging. He believed very much in one Nigeria, and I am particularly happy that you can hardly find a government that has done as much as he did in a very short time. And he refused to go outside Nigeria gallivanting, and eventually, his reign was successful.
I must commend you once again about these achievements because we still remember them, including the Gwarimpa Housing Estate, which is probably the largest in Africa. But back to energy, the issue of oil installation vandalism and oil theft in the Niger Delta is one of the worst nightmares of all the operators in this industry, including the government that gets its revenue from their taxes, and this has defied all solutions. What were the challenges during your time and how were you able to tackle them?
I think there were less people with thieving minds at that time. Secondly, I think some of those that had the guts to enter into that field were afraid of General Sani Abacha. I don’t have to tell you, everybody knew that he will not wait to dismiss anybody who showed signs of inconsistency or gangsterism, because it was the time of the Army and not civilian rule. So, I think most of those who now defy the laws know that it is a civilian government and whatever you do, the best that can happen is to go to the courts and it can take you years before you will even finish with what you are trying to do or solve the problem. And I don’t think I have any other reason but to say that it was much easier at that time to punish criminality. Now, people are more open to all kinds of gangsterism and theft of all kinds and they cannot get punished summarily. That’s why some will sacrifice for the nation and others will flee away with the gains, so that they can meet their expensive lifestyles and high cost of living in Nigeria.
Let us look at this, the Federal Government has done a lot recently in advancing petroleum prospectivity in the northern part of the country, even claiming some finds around Bauchi State, but there is also the challenge of insecurity in that region. What do you think will happen without fixing this insurgency or banditry, despite these economic prospects?
Insurgency and banditry are acts that stop everything good in the nation but not only in the oil and gas industry. Once that prevails, then, there is not much anybody can do, whether it’s education, whether it’s farming, whatever you do. So, in another way, there are also people who are interested in that oil and gas because gas is a very prospective element of our economy, even more than the petrol itself, and there are so many by-products that come from that. Therefore, if we are not careful, Nigeria will continue to be eluded by peace because it has been said that 80 per cent of pumped crude oil was lost to theft in the last year, and I don’t think it is only Nigerians that are stealing but there must be some collaboration with some outsiders, so that they can get away with the oil and enjoy themselves and leave Nigerians fighting.
I think that Nigerians must be reoriented and must know that we are in a serious dangerous situation of being enslaved again by the developed countries who want our own minerals and other resources that are in the country and in different sectors. Even in engineering and medical sciences, they have been employing our people to go and work for them and leave our country with a deficit of quality workforce, but we need to rededicate our national orientation efforts and Nigerians have to wake up and understand that we are to save ourselves than to go looking for saviour where there is none. If we are looking at the developed countries, they will only take 100 per cent and give us 15 percent as gift or aid, which is not good enough. So, let us take care of ourselves and let’s not give room to those who will come and take whatever we are producing.
As for the oil in the North, I don’t think it is also unconnected with the so many things that have happened, some of which one cannot say this and that in the open, but it is not that there is no oil in the North. Rather, to even get tapped is another problem; not Nigeria’s problem but those who have been so-called our friends, they bring problems, they try to stop us from doing the best we can, and we are still lagging behind. But sooner or later, it will come because Nigerians have to do it, we have to do it if we want to do it; it is in our minds and we have to do the best we can.
If we continue to lag behind or listen to other Nigerians who want to make sure we do nothing but keep quarrelling, while they are taking whatever they can from our country, then, it will continue to be a pity for us. So, we must brace up and try to get the resources we have to be used in the right direction and at the right time.
Looking at the Petroleum Industry Bill, which President Buhari himself supported to be passed, I don’t know whether you have read through all of it or just some aspects of it; but what are your thoughts on this recently passed PIA, has it addressed your anxiety or concerns for the industry?
Whether I have read all of it or all of it is in my head or not, I know one thing, that it is we Nigerians that will make it happen. We have a very good constitution, very good laws, we have everything but the operators. Can it be operated well and with good intentions and sincerity of purpose? That is our trouble. So, it is we Nigerians, we have to be serious with ourselves and we have to do the right things in order to help ourselves and to also skip all obstacles that are being put in front of us by others from outside Nigeria, who want us to fall so that they can take whatever they want from us. Let us get oriented, understand the policies, do the right thing and we will succeed.
We have the best of laws, the best of articles and PIA is clean, good and beautiful, but are the operators clean, good and beautiful? This is the problem because they will start putting pins here and there and changing. Without changing it physically, they will just change the implementation and you will think that it is true, and it will lose the taste. All soups are soups when they have all the ingredients, but when you reduce some of the salt, you find that it doesn’t taste well any longer. What I hope is that our Nigerian operators of the PIA, including the President, can understand this. We have another president coming in 2023 and he will have a great job to do because most of the work will start being done properly from 2023. It has actually started but that is when we will begin to see the actual results.
We are now in the age of energy transition, renewables are coming in and companies are trying to position themselves to move into the next phase of energy forms. Do do you think that our country is doing enough in order not to be left behind by the world?
I know that Nigerians are very brilliant and sound and some of them in the sector are doing their best, but sometimes we just leave things carelessly. We have everything we have planned, we have to do things, but people are often more interested in getting the money for these activities, diverting it into either their pockets or something else. The new energy system in the world now, especially in Nigeria, we have solar, wind, hydro and gas; and honestly, as I said before, it is we Nigerians that will have to re-dedicate ourselves, to re-orient ourselves, to help ourselves and make sure that we develop the best that we have, because God has given us a lot of materials; we have everything but instead of using it, we get diverted to do something which is not the best. So, let everyone that is working now do the best so that we can help the nation instead of helping only our individual selves.
We also have issues with the smuggling of refined petroleum products out of Nigeria, which may have been there during your time as well, and it is still hunting us even worse today. So, how do we go from here?
You have reminded me and I think it is one problem that I was saddled with solving during our time, the issue of petroleum products smuggling, and at that time we could not get it finished. I am not surprised about what is happening now, even though it could be worse, much worse, but then, if other energy systems are developed, it will reduce that a lot.
People sometimes argue that petroleum products are subsidized in Nigeria and the pump price is cheaper than what is sold in the neighbouring countries, making it an incentive for smuggling from Nigeria into those nations. Now that the PIA provides for deregulation, if prices come up after deregulation in Nigeria, do you think this can be a solution to the problem of smuggling?
If it can be deregulated now, you can deregulate and then destroy the country. That is the unfortunate aspect of it. The only way we can get it through is now that the Dangote Refinery is coming up and the other refineries are going to be put back into stream, then we can be able to deregulate, because when I was the Minister, we didn’t know about subsidy. What happened was that some amount of crude oil was allocated to the four refineries in Nigeria; we would give it to them in exchange for white products or we will sell crude oil to them and go and buy refined products and we were managing fine that time. But now, if you say we will deregulate and start calling N350 or N360, or even N400 per liter, the country will get lost, unfortunately, because there is no use we in the country having petrol here and paying through our nose, people dying because the price is deregulated and the money we are supposed to use here will be used elsewhere. So, government will have to solve the issue of refineries before deregulation of petrol prices.