FG admits huge spending on fuel subsidies

The federal government on Tuesday said it had spent so much to subsidize Premium Motor Spirit, popularly gasoline, confirming The PUNCHES investigative report into the current regime’s huge fuel subsidy spending.

On Monday, The punch exclusively reported that the President’s Administration, Major General Muhammadu Buhari (Retired), could spend no less than N10.976 billion as a subsidy for the PMS, since he came to power in 2015 until in May 2023.

The report said the government has already spent about 6.88 billion naira to subsidize the product, according to data obtained from the Nigerian National Petroleum Company Limited and the Nigeria Extractive Industries Transparency Initiative.

Speaking at the second World Energy Day conference on “Energy Security and Sustainability in the Oil and Gas Sector”, Minister of State for Petroleum Resources, Chief Timipre Sylva, however, noted that ‘with the opening of the industry, the cost of energy in Nigeria would be made affordable, considering the high amount spent on the fuel subsidy.

The WED was organized in Abuja by the National Chamber Policy Center of the Abuja Chamber of Commerce and Industry.

Sylva, who was represented by an official from the Federal Ministry of Petroleum Resources, Dipo Agboola, said the Petroleum Industry Act would further support the opening up of the downstream petroleum sector to ensure affordable energy for Nigerian citizens.

Responding to a question about the need to unbundle the downstream oil sector, he said: “We have spent so much on subsidies. But when you open up the sector, you create more opportunities for business. At first, the challenges might be a bit high.

“But over time it will certainly be in the best interests of the country. Take for example the telecom sector. When we first had MTN and Glo on board it was N18,000 for a SIM card, but today you can get that SIM card for as little as nothing.

“Also, you now have competition in this sector. So, as a country, it is necessary that we ensure that energy is affordable for our citizens. When energy is affordable for our citizens, we are able to achieve part of the Sustainable Development Goals. »

Sylva added: “As part of the 17 SDGs, energy is one of them, and these goals are essentially aimed at stimulating the development of people in their countries and around the world”.

For his part, ACCI Chairman, All-Mujtaba Abubakar, said that energy security is the uninterrupted availability of energy sources at an affordable price which has many aspects.

“Long-term energy security is primarily about timely investments to provide energy based on economic developments and environmental needs,” he said.

He added, “Nigeria is pursuing the energy transition to promote economic growth and is gradually investing in renewable energy; mainly solar, in order to reduce carbon emissions while continuing to exploit hydrocarbon resources, in particular natural gas, the fuel of Nigeria’s energy transition.

“The energy transition will continue to impact the ability of Nigeria and oil and gas companies to attract capital as banks and investors prioritize environmental, social and governance factors and move away from financing utilities. hydrocarbon projects.

Abubakar said after the conference that there would be a better understanding of business opportunities in the energy sector; a better appreciation of government efforts to develop the sector; enhancing private sector investment in clean energy; and new insights into the national energy transition policy.

“I believe security in the oil and gas sector would help Nigeria meet its daily OPEC oil production as well as meet the country’s energy needs,” he said.

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