Nigeria spent $13.8bn on fuel importation in 2016 –NBS

Despite claims by the Nigerian National Petroleum Corporation (NNPC) that the four Nigerian refineries are producing at 70 per cent capacity, it can be confirmed that the country imported petroleum products, estimated at about $13.8 billion in 2016 alone.

This is blamed on inability of the refineries to attain up to 50 per cent output capacity.

This is contained in the updated information on the website of the National Bureau of Statistics (NBS), captioned: “2016 Fourth Quarter (Q4) Foreign and Merchandise Trade.”

The statistics office noted that about 18.4 per cent of the said cost was used for the importation of Premium Motor Spirit (PMS) during the year under review.

It said further studies proved that fuel and lubricants dominated the import market, taking about 20.2 per cent, or $12.6 billion, while other products accounted for 9.9 per cent in the period.

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But observers say this runs contrary to government promise that before the end of 2016, only about 40 per cent of petroleum products would be imported.

They quoted the Minister of State, Petroleum, Dr. Ibe Kachikwu as saying that with no provision made for oil subsidy in the 2016 Budget, the local refineries would complement the shortfalls that import bills could not carry.

However, Mr. Gilbert Ikeotuonye, a petroleum market analyst, said the situation could have been different had government not failed in its early promise that it would involve private sector in ownership and running of the refineries.

“It should not be forgotten in a hurry that even the IMF and World Bank have separately advised Nigerian government to divest its interests in the refineries, for maximum result to be achieved from there.

“If that were done, the new investors would have been interested in turning the edifice around and when such is impossible, they would have deviced means of having a new technology in place to replace the outdated system still operational in each of the refineries”.

Another expert, Mr. Ibrahim Abdulahi, was of the opinion that if the amount being expended on importation of the petroleum products is re-channeled into the real sector, Nigeria would have since come out of recession.

But NBS said the structure of Nigeria’s export trade is still dominated by crude oil exports, which contributed about $18.2 billion, or 81.4 per cent to the value of total domestic export trade in the same year.

The 2016 fourth quarter report further showed that Nigeria’s’s import trades were mostly with China, Belgium and Netherlands.

The United States and India accounted for $133.3 billion, or 17.5 per cent, and about 102.5 billion,or 15.4 per cent, respectively.

However, the NNPC Managing Director, Dr. Maikanti Baru, recently identified siphoning of peyroluem products at the Kaduna Refinery, by hoodlums as the major reason the complex is not able to meet its production capacity through out 2016.

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