Former Vice President Waziri Atiku Abubakar has said the $1.5 billion earmarked for the repair of Port Harcourt refinery in Rivers State by the President Muhammadu Buhari’s government is suspicious.
Atiku stated this on Thursday, stressing that a similar, more profitable refinery, Martinez Refinery in California, USA was recently sold by Shell Petroleum Development Company for $1.2 billion.
Recall that the federal executive council (FEC) presided over by President Buhari on Wednesday approved 1.5billion dollars for the rehabilitation of the Port Harcourt Refinery.
Minister of State for Petroleum Resources, Timipre Sylva, who made this known, said the rehabilitation was in fulfilment of Federal Government’s desire to resuscitate the country’s refineries to reduce the cost of processing petroleum products as well as boost the economy.
However, reacting, Atiku in a statement, posited that the best solution for the nation’s refineries is to privatise them to be more effective and efficient.
He stated that to budget the sum of $1.5 billion to renovate or turn around the Port Harcourt Refinery appears to be an unwise use of scarce funds at this critical juncture for an assortment of reasons.
He wrote: “That Nigeria’s economy is in dire straits is a fact well known both to the nation and to our international partners. Unemployment has just reached an all-time high of 33%, while inflation has hit another record high of 17%.
“At this critical period, we must as a nation be prudent with the use of whatever revenue we can generate, and even if we must borrow, we must do so with the utmost responsibility and discipline.
“To therefore budget the sum of $1.5 billion to renovate or turn around the Port Harcourt Refinery would appear to be an unwise use of scarce funds at this critical juncture for an assortment of reasons.
“First of all, our refineries have been loss-making for multiple years, and indeed, it is questionable wisdom to throw good money after bad. At other times, I have counselled that the best course of action would be to privatise our refineries to be run more effectively and efficiently.
“Moreover, the cost appears prohibitive. Too prohibitive, especially as Shell Petroleum Development Company last year sold its Martinez Refinery in California, USA, which is of a similar size as the Port Harcourt refinery, for $1.2 billion. We must bear in mind that the Shell Martinez Refinery is more profitable than the Port Harcourt Refinery.
“Given this discrepancy, might we ask if there was a public tender before this cost was announced? Was due diligence performed? Because we are certainly not getting value for money. Not by a long stretch.
“We cannot as a nation expect to make economic progress if we continue to fund inefficiency, and we are going too deep into the debt trap for unnecessarily overpriced projects.
“Our national debt has grown from ₦12 trillion in 2015 to ₦32.9 trillion today. Indeed that is shocking enough to cause us to be more prudent in the way we commit future generations into the bondage of bonds and debt”.