The Federal Government has said that between 2005 and 2021 it spent over N13tn on fuel subsidy, adding that the country lost N16.3tn to oil theft from 2009 to 2020.
The federal government disclosed this in Abuja through the Nigeria Extractive Industries Transparency Initiative at a policy dialogue on oil swap, co-hosted by NEITI and Policy Alert, an indigenous civil society organization, with support from the Opening Extractives.
A presentation by NEITI’s Executive Secretary, Orji Ogbonnaya-Orji, which was made available to news correspondents, said there was an urgent need to make a decision on the agitation for the removal of fuel subsidies.
READ ALSO: Yoruba Youths Issue Stern Warning Against Fuel Subsidy Removal
He stressed that the full deregulation of the petroleum sector would permanently lay to rest the conversation around oil swaps, adding that latest findings by NEITI showed the humongous amount spent on subsidizing fuel by the government.
“NEITI’s latest policy brief titled, ‘The cost of fuel subsidy: A case for policy review,’ revealed that Nigeria expended over N13tn ($74bn) on fuel subsidies between 2005 and 2021.
“The figure in relative terms is equivalent to Nigeria’s entire budget for health, education, agriculture, and defence in the last five years, and almost the capital expenditure for 10 years between 2011 2020. It is also important to note other economic opportunity costs of fuel subsidy which include slashing allocations for the health, education, and technology infrastructure sectors.
READ ALSO: How Oil Exploration Will Benefit People Of Nasarawa – Gov Sule
“Others include the deterioration of the downstream sector with the declining performance of Nigeria’s refineries and recording zero production in 2020; disincentivized private sector investment in the down and mid-stream petroleum sector; low employment generation since the refining process is done outside the shores of Nigeria; worsening national debt; declining balance of payment, forex pressures and depreciation of the naira and of course product losses, inefficient supply arrangements, scarcity, and its attendant queues, etc,” Orji stated.
On crude oil theft, he said NEITI policy brief and data pulled from industry reports of the oil and gas sector “showed that between 2009 and 2020 (12-year period), Nigeria lost 619.7 million barrels of crude oil valued at $46.16bn or N16.25tn.”
Orji explained that the volume of crude oil losses represented a loss of more than 140,000 barrels per day, adding that between 2009 and 2018, Nigeria also lost 4.2 billion liters of petroleum products from refineries valued at $1.84bn.
“These findings and recommendations on tackling crude oil theft have been submitted to the President through the Presidential Committee on Crude Oil Theft, in which NEITI also served as a member.
“The committee has concluded its work and submitted its report to the President. The committee did an excellent job with far-reaching recommendations. I will like to commend the Office of the NSA (National Security Adviser) that coordinated that panel’s work,” the NEITI boss stated.
Trending video of the day;
Photo Credit: Getty