NIGERIA – The Federal Government of Nigeria has said the closure of the land borders by Nigeria Customs Service has reduced the consumption of Premium Motor Spirit, also known as petrol, from 60 to 52 million litres per day. This represents a difference of eight million litres per day.
The eight million litre reduction in fuel consumption was revealed by the Minister of State for Petroleum Resources, Timipre Sylva, in Abuja on Thursday when he appeared before the joint Senate and House of Representatives Committees on Petroleum to defend the budget proposed by the ministry for 2020.
The government, while admitting that the figures being presented did not reflect the actual volume of petrol consumed in Nigeria, also said there were no plans to remove the subsidy being paid on petrol.
Sylva said that closing the borders prevented smuggling of fuel and thus resulted in a net reduction in the amount of fuel being consumed in the country.
“Definitely, we are beginning to see the numbers reducing; from over 60 million litres, it has already come down – from the last account – to about 52 million litres per day,” said Sylva.
He added that the reducing figures show that “We are beginning to restore orderliness,” in the downstream sector of the oil industry
“We are trying to block other leakages and we believe that we can bring down the figure to about 40 million which will be more manageable by the government,” revealed Sylva.
The minister also disclosed that reduction in the consumption rate would result in a reduction in the amount budgeted for subsidy payment.
Sylva further noted that Work on the Port Harcourt refinery was scheduled to commence in January and that feasibility studies are also ongoing on Warri refinery and Kaduna refinery.
Nigeria has for a long time been trying to battle the issue of oil smuggling that costs the west African nation an estimated US$13.82 billion annually.
The losses have made it expensive for the government to maintain its petroleum subsidy program and it hopes that the recent measures to prevent oil smuggling will bring oil consumption to sustainable levels