Oil marketers, represented by the Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN), are urging the Federal Government to take decisive steps towards the privatization of state-owned refineries. This call aims to foster competition, enhance transparency, and invest in much-needed infrastructure within Nigeria’s downstream petroleum sector.
Specifically, the marketers have pointed to the necessity of privatizing the Warri and Kaduna refineries, each with a capacity of 125,000 barrels per day. They are also advocating for the enforcement of local content development, the effective implementation of Compressed Natural Gas initiatives by 2025, and a crackdown on the smuggling of petroleum products.
In a recent report released in Abuja outlining their 2024 assessments and 2025 outlook, PETROAN called upon the government to prioritize access to crude oil and to allocate a grant of N100 billion to support approximately 10,000 businesses impacted by the removal of fuel subsidies.
The document articulates critical recommendations aimed at bolstering the downstream sector by emphasizing that privatization is essential to enhance operational efficiency and reduce government expenditure.
Key recommendations from PETROAN include:
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Privatization of Refineries: Privatizing government-owned refineries to reputable companies to improve operational efficiency and lessen public spending.
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Market Competition: Encouraging new market entrants to promote a competitive landscape that prevents monopolistic practices and ensures fair pricing.
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Regulatory Compliance: Establishing a detailed monitoring framework to assess the performance of downstream operators and guarantee adherence to regulatory standards.
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Infrastructure Investment: Continuing investment in essential infrastructure and maintenance to boost refining capacity and decrease dependency on imported petroleum products.
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Support for Local Content: Promoting indigenous companies and providing incentives for research and development to strengthen local content within the sector.
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Private Sector Involvement: Encouraging private sector participation to enhance access to funding and expertise, along with revising regulatory frameworks to attract investments.
- Combating Smuggling: Collaborating with neighboring countries to enhance border security against smuggling, employing digital tracking systems to monitor the flow of petroleum products.
As part of their strategic vision, PETROAN insists on making crude oil available for local refineries, which could significantly elevate Nigeria’s refining capabilities while fostering economic stability and energy security. Moreover, they have formally requested President Bola Tinubu to consider their appeal for the aforementioned N100 billion grant to mitigate the potential closure of thousands of businesses in the sector due to subsidy removal.
