Subsidy Will Not Be Removed, Says Sylva

The Minister of State for Petroleum, Timipre Silva, has said that the federal government is not in anyway contemplating the removal of subsidy, even as he revealed that oil has been discovered in commercial quantity in Bauchi State.

Silva disclosed this Thursday while briefing the Joint National Assembly Committees on Petroleum Resources (upstream) on the 2019 budget performance and the proposed 2020 budget.

He said that while the subsidy might not be very clearly captured in the 2020 budget, provision was made for fuel subsidy.

Silva stated: “I want to say this government is not about to remove subsidy because it is difficult. We believe as a government that our people are already going through a lot of suffering and we cannot as a responsible government heap other issue of petroleum price hike or removal of subsidy on Nigerians.

So it is not on the cards at all. We are just looking at how we can manage it. It may not be clearly captured but I can assure you that it is there. If you look very carefully you will see it.

“We also believe that the consumption that is being posted on daily basis doesn’t represent the actual consumption of the petroleum product in this country. We don’t believe that Nigerians are consuming over 60 million litres a day. There is a lot of smuggling and because the petroleum product is cheaper in Nigeria, a lot of our neighbours are taking advantage of the cheaper process in Nigeria.

“So, Nigeria is now almost subsidizing half of Africa which is very difficult for us to do. So, you can see that the government is doing something about controlling some of these leakages and once those leakages are controlled, we believe that subsidy can be at least bearable.”

The minister explained that the decision of the federal government to shut the Nigeria-Benin boarder has led to the reduction of the daily consumption of fuel in the country from over 60 million litres per day to about 52 million litres per day.

He clarified that the federal government was more concerned about fixing the refineries, which would in turn reduce the cost of subsidy on the government, rather than removing the subsidy itself.

Sylva also said that work on the Port Harcourt refinery would commence in January, adding that study was also ongoing for Warri refinery and assured them that maintenance work would commence soon.

Asked why Anambra has not been designated an oil producing state, the minister noted that he has no power to declare any state an oil producing state.

He explained that oil has to be produced and seen before the state can become an oil producing state.

The minister stressed that why a lot of people think that Anambra is a prospective basin especially for gas, he said he cannot confirm the status of Anambra basin at the moment, but said no production activity is going on there yet, but he promised to find out.

According to him, “Nobody can deny any state of that status, if you are already producing that you will know that you are producing oil and cannot hide it. At least, we will be moving the oil from the state. You automatically become oil producing.

It is not within the powers of the Ministry of Petroleum to designate any state oil producing. I have announced here today to you that Bauchi is on its way, but Bauchi cannot also be designated as oil producing yet, but we know that in a few years from now, Bauchi will definitely become an oil producing state because what we have found there, the reserves are in commercial quantity