Slaying the fuel scarcity dragon

As I write this piece, Nigerians are about putting the lid on the latest incidence of fuel scarcity, the annoying wait at the gas pumps, burning away precious time in needless queues, looking for fuel with which to power their cars, generating sets and other industrial appliances.


Like many of the periodic acts of fuel scarcity that occasionally ravage this clearly misbegotten oil-producing nation, the media had before this time out caught a whiff of its imminence and written whistle-blowing stories to push the system managers to work at averting it. Characteristically however, the spin-doctors at the Ministry of Petroleum and the Nigerian National Petroleum Corporation, NNPC, preferred to obfuscate the facts and continue to wallow in denial. And then the chickens came home to roost; literally.


Because it is election season, funds were of course found from ‘ways and means’ sources to stem the gap, albeit temporarily, and to get fuel a fairly significant volume of fuel back to the pumps. The NNPC - which is yet to fully pay back the $1.48bn, which even the pro-establishment PWC audit report held, it had withheld from the Federation account - for example, promptly announced an injection of some 688million litres of products into the system in a move that it believed would definitely make the current queues history. It has succeeded in the main; but we are yet to slay the dragon.


And the reasoning here is simple. If it is true that the recurrent supply shortfalls have come upon us because the ‘Major Marketers’ say they can no longer continue to shoulder the burden of borrowing to import products on their behalf, and also on behalf of a government that perennially fails to pay its own negotiated ‘subsidy component,’ then the question is for how long can the NNPC wade in and meet the supply shortfalls? Also worth answering would be where the NNPC found the funds to import the current bridging stock as well as would find even more to undertake further importation thereafter given the cash crunch that has afflicted government revenues? All things considered then, the current queues will almost invariably return in the not-so-distant future, because the dragon still breathes.


At the centre of the problem is the crisis of perennial mis-diagnosis. In statement after statement, NNPC and the Ministry continually pass on the gauntlet. They accuse hapless Nigerian citizens of panic buying and their partner-marketers of hoarding on a good day and being most insensitive on other days. NNPC is the patriotic party in all of the messages and the enemy is the other. But beyond the blatant blame shifting that is apparent from these lines, it is also clear that any contributions by citizens and marketers in the entire debacle can only be flicks on an already developed gargantuan snow-trail. So we have to go back to the critical question of where the massive iceberg came from.


Critically examined, we are faced with that classic situation explored in that anti-imperialist poster that was most popular within the progressive students’ movement a few decades ago. It displays the picture of a Caucasian imperial overlord being carried in a hammock by black African freedom-seeking slaves, and the inscription which we only paraphrase here, read somewhat: ‘I am the source of your oppression, the only way you would be free is when I come down, but I would not!


Put squarely, the trouble with our petro-chemical complex today is the nature, structure and oppressive mould in which our oil affairs are managed. And it would take the complete restructuring of the Ministry of Petroleum Resources and the Nigerian National Petroleum Corporation to begin to appropriately reset the template. Herein is the path to our liberty as a people.
The NNPC and its mother ministry today are like the Caucassian oppressor described in the poster just referred to. They are imperial behemoths, parasites that leach on what should ordinarily have been a most robust national oil sector. We will not make any progress in our oil affairs as a nation if their excesses are not curtailed. And some of the corollary questions to address in this regard are whether we need them in the first place, and if we do, whether they should continue to remain in their present imperial form and shape, too?


As things stand in the sector today, our crude oil is explored and drilled by private prospecting companies. Going down the chain, other private companies negotiate long-term contracts to buy the produced crude and all of these objectively speaking can take place without the NNPC and the Ministry of Petroleum. Indeed, when the first oil contracts were entered into in colonial Nigeria, it was in the form of the Governor-General giving a long lease to Shell D’Arcy, precursor of today’s Shell Petroleum Development Company, SPDC, to prospect for, drill and market oil on behalf of the colonial state. And it worked. From 1938 when this lease was given to 1958 when oil was finally located at Oloibiri, this was the extant state of affairs. All the government involvement that was noticeable at this time was that Shell D’Arcy sent progress reports to the relevant desk in the Colonial Department of Mines. It was that much of a simple operation. And no one batted an eyelid.


At independence, it was still this state of affairs that persisted until the civil war and its aftermath when oil began to play a heavier role in the nation’s revenue profiles. This coupled with the move for more and more centralized federal power, led to the introduction of a Ministry of Petroleum Resources and the formation of the Nigerian National Oil Corporation which was to later become the Nigerian National Petroleum Corporation.


While it has been argued that the expanding profile of oil in the national economy justified the need to introduce these additions, the reality is that their introduction may have indeed done more harm than good to the overall national petrochemical and economic infrastructure. This is because, rather than assisting in the enhancement of the national petrochemical and economic value chain, they have rather retarded same. This is because though petroleum has since come to be the biggest source of our national revenue, its shoddy management by the agencies in the dock has resulted in a most untenable situation where the nation is today saddled with deficit refineries, a despoiled environment, perennially leaking pipelines and haemorrhaging national values. It is a sad day today in oil-endowed Nigeria.


And so without adding any significant real value to our national fortunes today, the Ministry and NNPC have become most notorious as a cesspool of scandals, blockades, easy cash, slush funds and economic sabotage. They routinely withhold funds from the Federation Account, make upfront deductions from revenues accruing to the nation and dispose of national assets at their own whims. This clearly is not the way to go. And these are the underlying reasons why fuel scarcity would not go for a very long time to come. Compelling reasons indeed why we must most determinedly, slay the dragon today.