The inability of the Federal Government to take a definite business decision in oil and gas even in the so called presence of Petroleum Industry Act (PIA) has continued to create havoc for the domestic economy.
According to the passed PIA, straight forward deregulation is supposed to have taken place across the energy sector, but the inability of the government to put things into shape before the takeoff of full deregulation as provided by the Act, remains a big operational gap.
Unfortunately, the most painful of the products that have been in the web of this forth and back is Liquefied Petroleum Gas (LPG), otherwise, cooking gas.
Findings show that when the President Muhammadu Buhari assumed office in May 2015, the price of cooking gas stood at N3,200 for 12.5kg with a kg selling for an estimated N250, rising by 14 per cent from N2,800 in April. Today, the price of cooking gas has skyrocketed by 232 per cent to N10,625 for 12.5kg between 2015 and 2022. Kerosene is currently hovering at N850 per litre and the majority poor is getting the heat full time.
The price of cooking gas also called Liquefied Petroleum Gas has been volatile in the last seven years. Latest market research conducted shows that the price of LPG currently hovers between N850 and N900 per KG depending on the supplier.
The worst of it is that government cannot do anything because it kept the cart before the horse and as such, there is no movement.
Sometime last year or so, the Ministry of Petroleum Resources created what it called Nigeria Gas Flare Commercialization Programme (NGFCP) and named Mr. Justice Derefaka as the program Manager.
But throughout this year, nothing has been heard on the body’s planned commercialization of scores of flare sites dotting the Niger Delta. Besides, all efforts to reach to Derefaka to know what is happening in his Programme, failed.
However, in an interview, an Energy analyst and consultant, Engr. Bala Zaka, he made it clear that “It is the kind of model the government has decided to provide energy as far as Nigeria is concerned and their attitude towards the oil and gas industry. Before the passage of the Petroleum Bill into law, some of us said deregulation was going to do more harm to the country compared to liberalisation or privatisation, or commercialisation, but people did not understand or listen. The Petroleum Industry Bill has been passed into law and everything about refining petroleum including cooking gas.”
According to Zakka, the government’s move to deregulate was what has birthed the challenges being experienced in the petroleum industry.
“What is happening to cooking gas is the same thing happening to aviation fuel, kerosene and diesel. Any country that cannot be self-sufficient in basic energy cannot reach anywhere. When you talk about cooking gas, that is the strategic domestic sector (SDS) now. If the SDS is not doing well, everything about food, whether processed or raw food, will be affected,” he explained.
Continuing, Zaka argued that the country’s energy crisis was caused by a lack of a refinery system before PIA.
“I think this government believes that importation is the way forward. Why will you be importing when you have a weak currency? How will you be importing when we cannot export anything? If the export and import differential is tending towards zero and negative, then everything about imports will mess up the economy. And by the time we look at other indices of the gross domestic product, the country will not grow,” Engr Zaka adduced.
