Group foresees fuel price hike soon as PIGB rests under-recovery, subsidy regime
More details coming from the yet to be harmonised Petroleum Industry Governance Bill (PIGB), have shown that apart from unbundling the regulatory agencies of the Nigeria’s oil and gas industry, it will equally rest further budgetary allocations for under-recovery and subsidy.
This, according to industry experts means that Nigerians should once again pass through the harrows of upward review in the price of Premium Motor Spirit, PMS, also known as petrol.
According to the Nigerian Association of Energy Economics (NAEE), “If PIGB is passed as it currently documented, the Nigerian National Petroleum Corporation (NNPC), would be compelled to discard unprofitable business practices including product under-recovery and subsidy regime.
Explaining more to journalists on its forthcoming annual conference, in Abuja, President of the NAEE, Professor Wumi Iledare, said “In the spirit of the PIGB, the NNPC is expected to transform into a profit-making entity, forcing it to discard unprofitable practices such as bearing the burden of fuel subsidy, which it currently calls under- recovery”.
“We are not going to continue this under-recovery for a long time, because when the PIGB is assented to, the NNPC that we have today becomes a commercial entity, with shareholders that would receive dividends. They would be key performance indicators that whoever is heading NNPC would deliver to shareholders.”
However, sources close to the presidency confided in Business Hilights Abuja Bureau chief that “Yes we are aware of the provisions of the PIGB in relation to ending payment of subsidy, but will not allow a situation where Nigerians will be under pressure because of the law. The official said government will find a way out to avoid shocks and wrong interpretation.
