LAGOS – Nigeria cannot overcome the hydra-headed regime of fuel subsidy on imported refined products without deregulating its downstream sector of the oil industry,petroleum marketers said in Lagos yesterday.
Specifically,the oil marketers under the Major Oil Marketers Association of Nigeria, MOMAN, Independent Petroleum Marketers Association of Nigeria, IPMAN, and Depot and Petroleum Products Marketers Association, DAPPMA, implored the federal government to urgently deregulate and liberalize the country’s downstream petroleum sector for unrestricted private sector participation and investment.
Speaking at a forum, the Chief Executive Officer/Executive Secretary, MOMAN, Mr Clement Isong, said the downstream petroleum industry regulations should be in line with international best practice.
He said the implementation and compliance with these regulations, the concept of cost recovery and competitive investment returns will ensure the sustainability of the downstream petroleum industry.
He said, “As the market players grow their business, they will increasingly become exposed to risk management challenges and will move their capital to areas where return matches the risks.
“We recommend that government should deregulate pump prices and focus on enforcing compliance with adequate regulations on health, safety, environment and quality.”
Isong said only total deregulation would save the situation. Contending that doing so will help attract more investments to the oil sector, he said only deregulation would encourage the establishment of private refineries and other related infrastructure in the country.
On how deregulation of the sector will impact on other aspects of the nation’s economy, he said, “Deregulation will also enable the Nigeria Railway Corporation to lift more products from the South to other parts of the country to reduce transportation.”
He stated that when private sector investors invest and build more refineries, products will always be available and this will be to the advantage of the common man.