FG to license private sector to build refineries

IN a bid to tackle challenges in the oil sector, the Federal Government is to give licences to the private sector individuals to build refineries.

The News Agency of Nigeria (NAN) the Minister of State for Petroleum Resources, Dr Ibe Kachikwu, made this known in Abuja on Thursday at the launch of a new roadmap tagged the 7 Big Wins.

He said the time had come to start taking decisive and positive actions and work toward creating thousands of jobs and making Nigeria the citadel of investment in Africa.

He said under the business and investment drive, he would raise a bulk fund for the Federal Government, targeting to raise $20 billion long term and $5 billion short term.

“That will require the refurbishing of our refinery, and the president has been very kind to ask me to prepare a team to drive this policy.

“Over and above that, we are going to be licensing private sector individuals to look at investing in private refineries.

“There is the need to reduce government stranglehold on the oil sector so that the private sector can flourish and grow in leaps and bounds,” he said.

He also said the government must commercialise gas flaring to make a revolution in the gas sector.

Kachikwu said that the programme was aimed at eradicating fuel imports and opening up space for investments to thrive.

”We must achieve the full operation of the refineries by 2020, and by 2019 we should have stopped importation of petroleum products.

“On Tuesday, the president will be having a meeting with stakeholders of the Niger Delta and oil producing areas; that is what importance he attached to this.

“It is important we continue to sustain the institutions of engagement and negotiations that are key to make this work.

“Our targets must be to have an incident reduction by 90 per cent by 2018 and a zero militancy position and shut down within middle of next year.

“This means that whatever shut down that occurs by middle of next year, we expect should be related to production and not by militancy issues.

“We must resolve current militancy problems and bring the number back to 2.2 million barrels.”

We are currently at 1.8 million; Shell forcados is coming upstream soon, so, we expect that to take us to two million barrels.

”We will like to begin the year with 2.2 million barrels but the reality is that 2.2 million does not represent the capacity of this nation.

”We have the capacity to increase production by three million barrels, and the problem has been funding; we are working very collaboratively with the oil sector to begin to find solution to our cash flow problems, ” he said.

According to the minister, transparency and efficiency is key to achieve all these.

”We are introducing a joint account with oil companies so that everybody understands the money that comes into this terrain and how it goes.

“We are targeting a 30 per cent in cost savings.’’

He said that creating the new oil and gas economy will create new businesses, new incomes with well-paying jobs, adding that the ministry had signed a memorandum of understanding of about $80 billion with China and $15 billion with India in investments.