The House of Representatives will on Thursday inaugurate an ad hoc committee to investigate the petroleum products subsidy regime in Nigeria from 2017 to 2021.
The decision was taken following the adoption of a motion sponsored by Hon Sergius Ogun (PDP, Edo) at Wednesday plenary.
Presenting the motion, Ogun complained at the secrecy behind the application of the public funds being expended on the fuel subsidy regime alleged that Nigerian National Petroleum Corporation (NNPC) Limited, found it more convenient to export domestic crude in exchange for petroleum products on trade by barter basis described as Direct Sales Direct Purchase (DSDP) arrangement.
He lamented that the consumption rate of Petroleum Motor Spirit (PMS) is 40million to 45million litres per day, however, the NNPC uses 65 million to 100 million litres per day to determine subsidy as discoverable from NNPC’s monthly reports to the Federal Allocation Committee (FAAC).
“The House notes that section 88 (1) and (2) of the Constitution of the Federal Republic of Nigeria (As Amended) empowers the National Assembly to conduct investigations into the activities of any authority executing or administering laws made by the National Assembly.
“The House also notes that Section 32 of the Petroleum Industry Act, 2021 saddles the Petroleum Midstream and Downstream Regulatory Authority with the task of regulating and monitoring technical and commercial midstream and downstream petroleum operations in Nigeria.
“The House is informed that as of 2002, the NNPC’s purchase of crude oil at international market prices stood at 445,000 barrels per day in order to enable it to provide petroleum products for local consumption.
“The House is concerned that as of 2002, the installed capacity of Nigeria’s local refineries stood at 445,000 barrels per day, however, their capacity utilization began to nosedive and eventually fell completely to zero due to the ineffectiveness and alleged corruption of critical stakeholders in the value chain.”