We Have Demystified The Oil Industry – Diezani

The Minister of Petroleum Resources, Mrs Diezani Alison-Madueke, recently fielded questions from a select group of editors to clarify a number of issues in the oil and gas sector ranging from the controversial kerosene subsidy and alleged subsidy scam to the allegation of $10bn expenditure on jet private hire as well as the PwC audit report. Excerpts.

On Kerosene Subsidy

There was a Presidential directive to withdraw subsidy on kerosene. It is possible that the Minister of Petroleum at that time must have gone to discuss it with the President and may have been able to convince him on the need to stay action on the directive. I assume that that may have been what happened, that he had a discussion with the President but he overlooked regularizing in terms of getting him to rescind the order.

So, if anybody flouted the Presidential order then it must have been the Minister of Petroleum at that time. But since the directive was not gazetted and was not announced it was not a law; it was mainly a directive on paper because there are procedures that a directive must follow to become a law and become implementable. I don’t know why people keep referring to this. But anyway, another president came and appointed his own cabinet and moved on.
Now, because of the confusion created by this situation, marketers who, prior to that time, were bringing in kerosene pulled back. The reason was that if they brought in kerosene at the international landing cost and sold at our subsidized rate and didn’t get paid the difference, they would go bankrupt.

So, there was immense confusion and I think it was at that time that the NNPC had to step in and started supplying. That was before I became Minister of Petroleum.

This was where the problem of deduction of subsidy claims at source started. The issue of deduction at source has also been severally argued as to whether NNPC has the right or not to cover all those particular expenses from crude oil sales proceeds.

That was the situation with subsidy at that time. When we came out in January 2012 to try to regularize the system by removing subsidy on petroleum products, of course we all knew what happened.

Efforts to Rid the Subsidy System of Corruption

So, based on all that, subsidy on petroleum products continued up to this point. It is a sore point because, in all honesty, just like PMS, it is a very difficult issue to handle. It becomes even more difficult when revenues are falling because of the price of the barrel.

It is very difficult to pay vast amounts on subsidy which we don’t believe is getting to the actual users, the bottom line users of the PMS, but which is instead making middlemen fat. But we wanted to remove the subsidy. We wanted to deregulate too because we discovered that there was corruption in the subsidy system which had gone so bad that we were not able to move products seamlessly from one point to another.
There was arbitrary price increase in some areas and products were selling above the regulated price thereby making nonsense of the subsidy scheme.

Then there was round tripping, terrible incidence of round tripping. It got to the point that I even had to get the permission of Mr. President to invite the EFCC to come and look at the books and help us figure out what was happening because the level of PMS import we were getting clearly showed that something was wrong.

That was in 2011. At some point the round tripping was extended to kerosene which was being diverted and sold as aviation fuel. Marketers would take their allotment of kerosene and sell it as aviation fuel which is more expensive. You know the kerosene that is imported into Nigeria is of the same specification as aviation fuel.

That is why it is called Dual Purpose Kerosene (DPK). It was not profitable to import what is really the base level of normal Household Kerosene (HHK). These were some of the problems we had. As I said earlier, we had written to the EFCC and didn’t get any response, that …..

More: http://www.vanguardngr.com/2015/02/we-have-demystified-the-oil-industry-alison-madueke/

Mrs. Diezani Alison Madueke Minister of Petroleum Resources 1024×688

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The most corruption in the world goes on in NNPC. It is in the corporation that 100% of the suppliers and vendors are related to the senior staff. Every Manager to Director I know in NNPC is a dollar millionaire. This is a corporation managed so opaquely that it is a good study in how not to manage a company. So for Diezani to work perfectly, she must step on toes. That she have continued to do. Weldone madam.

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WELCOME TO MARCH 2015
The count down to the exit of a mediocre has long begun. “Only a debtor thinks tomorrow is far; APC is already in power by
the grace of God. Don’t fight; make peace.”

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She demystified the oil industry by depleting the accounts. Thank you ma, may the Lord reward you the way you have served Nigeria

The most corruption in the world goes on in NNPC. It is in the corporation that 100% of the suppliers and vendors are related to the senior staff. Every Manager to Director I know in NNPC is a dollar millionaire. This is a corporation managed so opaquely that it is a good study in how not to manage a company. So for Diezani to work perfectly, she must step on toes. That she have continued to do. Weldone madam.

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“Who is going to fight corruption? The APC people or Obasanjo? They only pay lip service to fighting corruption. Buhari himself is not clean. What is corruption? Malpractices, parading questionable certificates, swearing to false affidavit, they are all part of corruption. And in the 1970s when Buhari was federal commissioner for petroleum, about $2.8 billion oil money went missing. It was later discovered that this amount was paid into a British Bank where it yielded about N400 million interest. Nobody knows where that money is. Buhari said he did not know about it. He was appointed by Abacha as chairman of PTF, my own brother, Prof. J.P. Clark, was a member. In fact only Prof. J.P. Clark and Buhari are still living members of PTF. Buhari brought his brother-in-law as a consultant and later handed over the entire administration of PTF to him and others. They had the authority to execute all projects. At the end of it all, they left and Obasanjo dissolved the board and removed all of them. Then Obasanjo set up a Commission of Enquiry to probe the PTF and the report, which has been published by some newspapers, shows that N25 billion could not be accounted for by Buhari and those who administered the place. Yet Obasanjo came out to say the only thing he found against him was that instead of building roads and houses, he was busy buying mosquito nets with PTF money.”

—- Edwin Clark Former Information Minister
Vanguard News Sunday February 22, 2015

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Just passing by anyway.

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Ahmed Garba:

WELCOME TO MARCH 2015
The count down to the exit of a mediocre has long begun. “Only a debtor thinks tomorrow is far; APC is already in power by
the grace of God. Don’t fight; make peace.”

Yes o!!!

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