Nigeria former vice-president, Atiku Abubakar has faulted the Federal Executive Council’s approval of $1.5 billion for the rehabilitation of Port Harcourt refinery in Rivers state. According to the former Presidential candidate of the Peoples Democratic Party, the approval of $1.5 billion to renovate the Port Harcourt refinery is suspicious at the least.
He also pointed out that Shell Petroleum Development Company last year sold its Martinez Refinery in California, USA, which is of a similar size as the Port Harcourt refinery for $1.2 billion.
Atiku Abubakar who also noted that Shell Martinez Refinery is more profitable than the Port Harcourt Refinery, stated that the cost of renovation of the Port Harcourt refinery appears prohibitive.
According to his statement on twitter;
“$1.5 Billion To Renovate The Port Harcourt Refinery Is Suspicious At The Least.”
He further revealed that Nigeria’s economy is in a state of hopelessness. Unemployment has just reached an all-time high of 33%, while inflation has hit another record high of 17%. At this critical period, we must as a nation be prudent with the use of whatever revenue we can generate, and even if we must borrow, we must do so with the utmost responsibility and discipline.
To therefore budget the sum of $1.5 billion to renovate or turn around the Port Harcourt Refinery would appear to be an unwise use of scarce funds at this critical juncture for an assortment of reasons.
First, our refineries have been loss-making for multiple years, and indeed, it is questionable wisdom to throw good money after bad. At other times, I have counseled that the best course of action would be to privatize our refineries to be run more effectively and efficiently.
Moreover, the cost appears prohibitive. Too prohibitive, especially as Shell Petroleum Development Company last year sold its Martinez Refinery in California, USA, this is of a similar size as the Port Harcourt refinery, for $1.2 billion.
We must bear in mind that the Shell Martinez Refinery is more profitable than the Port Harcourt Refinery. Given this discrepancy, might we ask if there was a public tender before this cost was announced? Was due diligence performed? Because we are certainly not getting value for money. Not by a long stretch.
We cannot as a nation expect to make economic progress if we continue to fund inefficiency, and we are going too deep into the debt trap for unnecessarily overpriced projects.
Our national debt has grown from N12 trillion in 2015 to N32.9 trillion today. Indeed that is shocking enough to cause us to be more prudent in the way we commit future generations into the bondage of bonds and debt.