The Nigerian National Petroleum Corporation (NNPC) has announced that President Tinubu’s administration is set to restore one of the country’s four refineries to optimal functioning before the end of the year.
Mele Kyari, the Group Managing Director of NNPC, revealed this development during a meeting with the National Chairman of the All Progressives Congress (APC), Senator Abdullahi Adamu.
Kyari also emphasized the need to address the escalating costs of fuel subsidies and the associated economic challenges.
Kyari, speaking after his meeting with the APC National Chairman, outlined the government’s plan for rehabilitating the refineries. He assured the public that repair work is already underway and that one refinery will be operational by the end of the year.
This step is seen as a crucial measure to reduce the dependence on fuel imports, stabilize prices, and improve the availability of petroleum products across the country.
The need for subsidy reforms stems from the unsustainable nature of the existing subsidy system. The costs associated with fuel subsidies have been mounting, placing a significant strain on the nation’s finances.
Kyari acknowledged that Nigeria can no longer afford this expensive regime, as evidenced by the mounting subsidy bills and the inability to settle outstanding payments with NNPC. The NNPC chief emphasized that pricing petroleum at market rates is the prudent approach, which will benefit the country in the long run.
President Tinubu had already declared his administration’s intention to halt the payment of subsidies on petroleum products during his inauguration.
The subsequent discontinuation of subsidies led to a sharp increase in transportation fares and the resurgence of long queues at fuel stations in major cities. The situation was further exacerbated by the closure of some fuel outlets, leading to panic buying and scarcity.
Kyari’s statement provides a glimpse of the fiscal challenges faced by the government. He revealed that only four states—Lagos, Abuja, Kano, and Rivers—account for over 38 percent of the total fuel consumption in the country.
He also highlighted the financial burden faced by NNPC, with a net balance of over N2.8 trillion owed by the federation. These circumstances make it impossible for the company to secure external funding or collect receivables.