Kachikwu whose also the Group
Managing Director, Nigerian National Petroleum Corporation, NNPC said
government had resolved to scrap oil subsidy because of alleged fraud around
it.
The Federal government is set to reduce the pump price of petrol to about
85 or 86 naira per litre.
Minister of State for Petroleum , Dr Ibe Kachikwu who disclosed this
during a tour of the Port Harcourt refinery on Christmas Day expressed hope
that the new price regime may come on stream January next year.
He said efforts were on to get the refinery to achieve 60 percent
production capacity and to supply about 11 million liters of petrol daily.
“If you look at the new PPPRA template that we developed and which I just
signed off two days ago, when it is announced you will find out that for now and
I use the emphatic word of the President for now, the price of the refined
product will actually be lower than 87 naira, It will be 85. We will probably
announce that in January if the prices hold.
“like I said, we have done a modulation calculation and it is showing us
below N87. I imagine that if PPPRA publishes it today, it will become effective
immediately. But the 1st of January that is when we are looking at.”
“What that does for you is that its modulating. If it goes up you move up,
if it comes down you come down. So we take away the fact of having to go find
funds to pay for these subsidies that we cannot afford.
“More importantly we try to be as close to the pump price that we have now
as possible,” he said.
“So for the first time people will understand that the pricing modulation
I was talking about is not a gimmick. It is for real. The objective is that we
cannot afford to continue to subsidize .We can’t even understand where those
subsidies were going to. There is a lot of fraud elements in it so we need to
cut that of.
The second is the earning capacity of the Federal Government is
deteriorating by the day with lower prices of crude “, he said.
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