President Bola Ahmed Tinubu has urged caution in implementing solutions for crude oil and refined products sales in Naira, emphasizing that the approach should not revert to experiences of the last 40 years.
Speaking during a review meeting with the Implementation Committee on Naira-based sales of crude oil and refined products at the State House, Abuja, Tinubu stressed that while cost and revenue adjustments in the oil sector are necessary, the government must avoid reverting to outdated methods.
He acknowledged that while adjustments in costs and revenue within the sector may be necessary, the reforms must ensure the government does not revert to ineffective methods.
He commended the implementation committee on the Naira-based sales of crude oil and refined products and asked the members to resolve any teething problems.
According to a statement by his Special Adviser on Information and Strategy, Bayo Onanuga, the President said that using the Naira was conceived to remove the exchange rate hurdle.
“Whatever solution we proffer in crude oil and refined products sales in Naira should not take us back to our experience in the last 40 years.
“There can be cost and revenue adjustment in the oil sector, but the issue is that the government will not have to go back to the old way of doing things,’’ the President stated.
Tinubu said the various players in the oil sector, including the Nigerian National Petroleum Corporation Ltd and the Dangote Refinery, should work to improve the economy and the livelihood of Nigerians.
The President urged stakeholders to look inward and consider supplying enough petrol and petroleum products for local consumption to stop the persistent reliance on importation. He said this would enable the channelling of foreign exchange into the development of the real sector.
The President advised stakeholders to use Afreximbank as a settlement bank to resolve the Naira pricing for crude and refined products. Afreximbank is already on board as the financial adviser.
“The market must determine what we are doing. Once you allow the market to determine the profit and loss, independent marketers and the government side can meet on the worksheet. I want the issues resolved without future waste of time,’’ he added.
“We can have energy security, and the motivation for Alhaji Aliko Dangote will not be defeated. It will be more predictable on a medium and long-term basis,’’ the President said.
The Minister of Finance and Coordinating Minister of the Economy, Wale Edun, said the administration’s groundbreaking steps to sell crude in Naira would not be reversed and the government would not be involved in determining the rate of exchange for the oil sector.
The President and Chief Executive of Dangote Group told the President that the refinery had more than 500 million litres of fuel in reserve after supplying 400 million to the economy.
He said the refinery could collaborate with the other refineries managed by NNPC Ltd to meet an estimated 32 million litres of local petrol needs.
At the meeting, the Federal Inland Revenue Service Chairman, Zach Adedeji, who chairs the technical committee, said importing refined products should end once we have the capacity to produce enough to meet domestic needs.
“The vision of Mr President is to turn Nigeria into a hub for refined products to export to the world,” he said.
