Tag: Federal Executive Council (FEC)

…FG to end fuel importation by 2019

The Federal Executive Council (FEC) on Wednesday approved new policies for oil and labour sectors.

The Minister of State for Petroleum Resources, Dr. Ibe Kachikwu and Minister of Labour, Chris Ngige disclosed this to State House correspondents at the end of the FEC meeting chaired by Acting President Yemi Osinbajo at the Presidential Villa, Abuja.

They were with the Minister of Information, Lai Mohammed and Minister of State for Budget and National Planning, Zainab Ahmed.

Kachikwu said that the Federal Government is committed to ending fuel importation into Nigeria by 2019.

He said “In terms of specifics. What a policy document does is that it gives you a general guideline in terms of where you are headed then you go into the specifics in other separate documents for purpose of execution. If you take the 2019 time frame for refinery for instance, it won’t tell you what I’m doing today but will tell you that I have set a timeline to exit importation and to get the refineries working by 2019.

“But if you ask me specially off the shelve what are we doing on that? There is a steering committee already in place which I head, there is a technical committee team already set up headed by chief operating officer in NNPC, we have had series of meetings with individuals who are willing to put money into the refineries.

“I need to state this clearly, this is not a sale, this is not a concession, this is a financing scheme and there are over 30 people who have indicated interest in that financing.

“They are going to go through the usual due process mechanism to see who qualifies for that financing. What we have resolved however which we have at least have a landing is that each of the refineries would be repaired by the individual company that built the refinery.

“Who does the  work is different from who does  finance the work to be done. We are still dialoguing who is going to get the financing opportunity but who is going to get the contracting opportunity to do the work is already decided. If you check the companies that built I think is Chioda in the north, Saitem in Warri if I’m not mistaken. I have forgotten the one in Port Harcourt but all of them have reached agreement with us in terms of willingness and readiness to do the so work.

“Government is not putting money into this. It’s going to be very sector led effort and they will recover their money through incremental volumes that will arise from the production increase arising from the repairs. We are doing about 30 percent performances on most refineries now so if you get them to above 90 percent template we are going to use some of the product line to pay for some of the debts and free ourselves from the importation problems.” he said

While noting that all the refineries in Nigeria today when repaired cannot cover all her consumption, he said that some level of efficiency and upgrade will increase the refineries capacity in the country.

He said “We are banking on the fact that efficiency steps we are taking will reduce the consumption. We have gone from the 50 million liter per day when I resumed office down to today that is about 28 million liters per day.

“So, obviously efficiency has wiped off smuggling, efficiency has reduced consumption and also whatever gains we made under the subsidy regime by taking the subsidy out has also taken out. So if we are reducing the level of consumption and increasing the efficiency of the refineries, we are banking that we will be able to exit importation completely. And this is not building in Dangote refinery that is 165,000 barrel cap on it, or the modular refineries we are looking at or the AGIP we are looking at.

“So I think we are finally on course and we are going to be very aggressive on target,” he said.

But he said that improving oil production target was very dicey.

“We are targeting to recover full barrels; it’s going to be a longer time provided the OPEC environment permits I think I see the potential of 2.5 and 3 million barrels over the two year period. But then we are all looking at market fluidity and the challenges that goes with how much we pump into this market,” he said.

On legislation, he said that a policy is a policy and cannot over take the legislation that will help drive inputs into some of what the National Assembly has done.

“Ultimately we are going to work collaboratively to make sure all is put in place to push some of the policies we are doing here. Some are efficiency off the shelf things we can do on our own but some the legislative mandates behind it would have to crystallized.” he said

According to him, the Council on Wednesday considered the Nigeria Petroleum Policy document.

Stressing that the essence of the gas policy, which was considered three weeks ago, is towards changing the imperatives of Nigeria from an oil producing country to a gas producing country.

He said “We are lot more privileged to produce more gas. Today policy focused on oil, the imperative needed to change in policy in the oil sector, it dealt in certain fundamentals we are already pursuing some of the policy.

“We are working assiduously to exit the importation of fuel in 2019 and captured the cash calls changed we have done which enables the sector to fund itself through incremental volumes, it captures the reorganisation in the NNPC for efficiency and enable accountability, it captured the issues in the Niger Delta and what we needed to do as a government to focus on stability and consistency in the sector.

“It is a very comprehensive 100 page document that deals with all the spectrum in the industry, the last time this was done was in 2007 and it has been 10 Years and you are aware that the dynamics of the oil industry has changed dramatically.

“Apart from the fact fluidity in pricing and uncertainty in terms of the price regime in crude. We are pushing for a refining processing environment and move away from exporting as it were to refining petroleum product, that’s one change you will see.

“Secondly how we sell our crude is going to be looked at, there is a lot of geographical market we need to look at long term contracting and sales as opposed to systemic contracting we have been doing,” he added.

He was optimistic that the change process that was started in 2015 will be brought to logical conclusion in next few years if the new document is well executed.

Ngige disclosed that FEC received the National Employment Policy which will guide the administration.

He said that the last employment policy in operation in Nigeria was approved in 2002.

“That’s 14 years and in that 14 years a lot of things have changed in labour and employment industry.  Things like employment, for people with disabilities, decent jobs programme and doing jobs without polluting the environment and other things that are new and contemporary in the labour market.

“So this policy was reviewed in 2013 with technical assistance from international labour organisations and major stakeholders like employers were involved, workers, unions and this document was crystallised and this policy seeks to give decent jobs to people.

“Job creation is multi sectoral, it is not limited to one ministry, not limited to the public service alone and private sector is involved and this policy seeks to capture the relevant affected persons and people that will apply this so that we can fight unemployment and under employment,” he said.

On the issue of minimum wage, he said “You were here in May when FRC approved the composition of the minimum wage committee. We have since then gone into action

“Government has approved their representation which is the secretariat. The secretariat is domiciled at the National Council for Salaries and Wages Commission with the chairman there acting as secretary.

“We also have the minister of labour and employment as deputy chairman, minister of finance, minister of budget and national planning as members. The only appointee which is being awaited now is the chairman and we have concluded the process for the nomination. We are waiting for the requisite approval.

“The labour centers that is NLC and TUC are yet to bring their nomination that is on the workers side. On the employers’ side, you know we are like a subunit. We have Nigeria Employers Consultative Assembly, Nigeria Employers Consultative Association (NECA), Manufacturers Association of Nigeria (MAN), Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture. (NACCIMA), Small and Medium Scale Industry Association (SMSIA).

“These groups will give us nominations so we are waiting. Once these nominations are in place the president will then inaugurate the committee.

“On the other side, the labour laws are clear; the labour laws seek to protect both the workers and the employers. You don’t sleep on your right. When you know what is there your worker cannot take you for granted provided you also conform to the law. You cannot lock them out and if you do the law says you pay them for the period of lock out. They too cannot take the law into their hands and embark on strike without giving you the mandatory notice, due consideration and social dialogue with you internally, second level with the ministry of labour and employment and third level is the issue of giving you notice.” he added

Ahmed said that her Ministry presented the National Social Protection policy to the Council on Wednesday.

The policy, she said, is a framework that seeks to provide social justice equity and inclusive growth by using a transformative mechanism for mitigating poverty and unemployment in Nigeria.

According to her, the social investment programme started by the Federal Government since 2016 were drawn from the policy, which is currently in a draft form.

“What we have done is to submit to the council today, a policy that is largely inspirational, aspirational but seeks to ensure that every Nigerian gets at least a minimum of what is required in terms of human development and protection,” she stated.