It Is Unnecessary To Increase Fuel Price – Prof. Sagay

Says He Will Be Upset If Fuel Price Is Increased

A renowned Professor, Senior Advocate of Nigeria (SAN) and Chairman Presidential Advisory Committee Against Corruption (PACAC) Itse Sagay has expressed worry over plans of the Federal Government to increase the price of Premium Motor Spirit (PMS) in the country. Prof. Sagay SAN in an interview with Temidayo Akinsuyi of the Independent Newspaper said that he will b very upset if the Fuel price is increased.

When asked of his take on the Federal Government approval of $1.5 billion to fund the repair of the Port Harcourt refinery which was closed two years ago and the mixed reactions generated from Nigerians including the Governor of Rivers State Chief Nyesom Wike as a result of whooping approval.

The federal government few weeks ago approved $1.5bn in funding to repair the Port Harcourt refinery, which was closed two years ago. This has continued to generate mixed reactions from Nigerians, as some have argued that it should have been sold in its present state. What is your take on that?

Prof. Sagay noted that he want to take refuge in his ignorance because he was shocked when he heard the amount to be used in repairing the refinery.

“$1.5 billion just to repair? Honestly, I was shocked. I  thought we could get a brand new, excellent refinery with that money. I also listened to the Minister of State for Petroleum and others who are in support, telling us that the whole refinery will be totally overhauled and what we are going to get after the repair will be as a brand as new at the rate of 90 per cent. I pray for their sake that it is true. If after that huge sum of money had been spent on revamping it and then production commences and it becomes epileptic, I don’t think they will be able to survive the barrage of attacks that will be landing on them. In fact, it will be more than that because people will call for them to be prosecuted for misleading the public and investing so much amount of money on the refinery.”

However, Prof. Sagay noted that why he is not worried so much is that there is a cabinet which holds a weekly Federal Executive Council (FEC) meeting of about 50 to 60 people. He noted that if they are able to carry all those people, maybe they must have made some cogent points. That is the way he comforts himself.

He equally expressed that we just have to wait for the next three to four years whether they will be proven right or not. He pray for their sakes that they are proved correctly that we are going to have a refinery that is brand new, even though it is an old one that is fixed. What they are telling us is that this is not turnaround maintenance, but total rebuilding.

He said he has also read the opinion of some people who said instead of repairing the refinery, why can’t they sell it in the present state and then allow the buyers to repair it themselves? He said he think that is being too clever because who will now want to pay $1.5 billion or more for a refinery that they know was scrap before and someone has just tried to fix?

He think it is better for him to aim to be able to produce the 90 per cent capacity and produce with it for about five years without question. Otherwise, I don’t think he is going to have any peace on this matter. The money is just too much. $1.5 billion is a huge sum of money. We are not talking of N300 million which they used for their turn around. $1.5 billion is a huge sum. So, he pray for his sake that all they have promised will be materialized.

When asked of if he would be shocked on The Group Managing Director (GMD) of Nigerian National Petroleum Corporation (NNPC), Mele Kyari’s expression that the corporation can no longer bear the over N120bn monthly subsidy on Premium Motor Spirit (PMS) also known as petrol. Nothing that it may have impact on the current price of fuel at N162.

Prof. Sagay noted that he will not be surprised but he will be very upset.

“I think it is good to be ignorant. Those of us who are ignorant in economics are not seeing it the same the NNPC and the experts are seeing it. Let us try and look at the logic of what they are saying. When the NNPC are getting almost nothing for oil, if the price crashes to $10 per barrel, then they are ready to dash Nigerians the petrol and were selling it for little or nothing. In other words, out of that their little or nothing, they now have to look for money to make us get petrol. But now when they are being well-paid for it, when crude oil is now at $60 per barrel, that is when they can afford to subsidise because they are making so much money. They can take out of that money and make cheap petrol available for the country. But the way economic theory has turned it round that the less NNPC earns in terms of crude oil, the more it should be able to subsidise we, the users to the extent of almost paying nothing for it. But when it is earning huge sums; when it has the money to actually do the subsidy, then it should also increase the price. It makes no sense. The illogic of it arises from the fact that they say that it is a theoretical thing. We are now earning $60 per barrel. So, if we give away crude oil for refined one, it must be at that rate because that is the rate it is being sold. If we give it at a lower rate, we are losing money at the international level. I think that is stupid economics. In my view, the more you earn, the lower the price of petrol because you are having more money now from the industry, which can enable you bring the price down for the benefit of the people. The less you earn, the more difficult it should be for you to subsidise. That is when the price should go up. So, for me, the economics is upside down economics. They will never have a good excuse in my eyes for increasing the price of petrol when they are doing very well in the international market for crude oil. To me, that logic is theoretical economics logic which is totally at variance with the reality of what they are earning and therefore with the interest of the people of this country. So, there is no excuse for increasing the price of petrol and I will be very upset if they do that.”

He noted that it would amount to sheer wickedness for Nigerians to be bear unnecessary burden expressing that he will be very upset if the price of petrol is increased.