Abuja – The Minister of state for Petroleum Resources, Mr Ibe Kachikwu, on Monday said that the new fuel price regime will create massive investment in infrastructure by attracting foreign directive investment (FDI) in the country.
Kachikwu disclosed this during an emergency plenary session held by members of the House of Representatives in Abuja.
The minister explained that the new price would enable FDI to focus on the big ticket such as pipelines and refineries for the development in the upstream oil and gas sector.
According to him, it will also increase refining capacity of the domestic refineries through relocation and co- relocating smaller but cost efficient refineries with a time frame of 12 to 24 months.
“It will focus on restoring upstream production by positively engaging host communities to put the current militancy to an end once and for all.”
He said that the deregulation will focus on Government funding in the upstream where funding had been less than 30 per cent.
“It will relieve Government of monthly cash call funding and create a sustainable self funding arraignment for Government equity in existing joint ventures.
” It will ensure effective development of Nigerian gas market with adequate and sustainable gas supply to power, industrial sector and develop gas based industries for national economic growth and development,” he said.
The minister further stated that the government would continue to engage the general public and all stakeholders by providing relevant information and education.
Kachicwu emphasized that the Nigerian National Petroleum Corporation (NNPC) will no longer resort to federation barrels.
He said the government will instead endeavor to meet its obligation to pay Federation Allocation Account Committee (FAAC) 100 per cent of its entitlement from the 445,000 barrels per day timely in the coming months.
According him, the price ban has gone into effect and the market has stabilise in a matter of days in terms of product availability.
The Leader of the House, Rep. Femi Gbajebiamila, said that the issue of fuel deregulation was a global phenomena and not restricted to Nigeria alone.
He added that all OPEC countries had deregulated their oil sector since the fall in oil price advising that it was important Nigeria followed suit to meet up with its economic challenges.
The House therefore resolved to set up an adhoc committee to interface with stakeholders in Labour and Petroleum sector.
It also urged Labour to suspend its planned strike pending the outcome of the committee.
