Former Vice President Atiku Abubakar has backed Dangote Refinery’s opposition to arbitrary petrol price controls, saying his proposed production subsidy would support domestic refineries without forcing them to sell fuel below cost.
Atiku’s position was contained in a statement issued by his Senior Special Assistant on Public Communication, Phrank Shaibu.
He accused the administration of President Bola Tinubu of misrepresenting his proposal following Dangote Refinery’s warning about the impact of pump-price controls on refiners.
Atiku said his proposal was based on a production subsidy rather than an import subsidy. Under the plan, he said, qualifying Nigerian refineries would receive support through reduced crude feedstock costs.
He argued that the arrangement would lower domestic production costs and allow consumers to benefit from cheaper fuel while allowing refiners to retain legitimate costs and a reasonable commercial margin.
“Import subsidy spends public money supporting petrol refined abroad and brought into Nigeria. Production subsidy supports crude refined here in Nigeria so that Nigerian refineries can produce fuel more cheaply and Nigerians can pay less,” Atiku said.
The former vice president said the proposal would not require Dangote Refinery or any other domestic producer to sell below cost.
He said any support would be tied strictly to crude refined in Nigeria and would not benefit foreign refineries, importers or middlemen.
Atiku proposed safeguards including a fiscal ceiling, a maximum support level per barrel, independent verification of crude supplied to participating refineries, electronic tracking of crude intake and refined output, domestic supply obligations and independent audits.
He also called for penalties for diversion and fraud, saying the government should be able to account for every barrel receiving support and the benefit delivered to consumers.
Atiku said the commercial viability of Nigerian refineries was important because the country’s refining sector would depend heavily on private investment.
He accused the Federal Government of defending an economic policy that had increased the cost of fuel, transportation, food and business operations for Nigerians.
According to him, the government should not set an arbitrary petrol price and transfer the resulting financial burden to domestic refiners.
“Dangote is right that a refinery should not be forced to carry the burden of an artificially imposed price. We agree. Nigerians are also right that the present cost of fuel, transportation, food and doing business has become unbearable,” Atiku said.
He maintained that his proposal was designed to address both concerns by lowering production costs while protecting domestic refining.
“We are proposing a production subsidy not an import subsidy. We are not proposing to subsidise petrol refined abroad. We are not proposing to force Dangote or any other Nigerian refinery to sell below cost,” he said.
Atiku backs Dangote, says subsidy plan targets Nigerian refineries
