Oil and Gas Expert, Nick Agule has asserted that Nigeria’s failure to maintain and use its pipeline network is adding to the cost of petroleum products, while calling for the Nigerian National Petroleum Company Limited (NNPCL) to be unbundled and placed on the capital market.
Speaking during an interview with ARISE NEWS on Monday, Agule said NNPC controls upstream, refining, pipeline and gas assets but has failed to make effective use of its pipeline infrastructure, forcing petroleum products to be moved by road across the country.
“The NNPC is sitting on pipeline assets in this country that have been moribund, It is about unbundling that company and putting it on the capital market the way Dangote refinery is going on to the capital market.”
He said transporting petroleum products by road adds to the cost of fuel because products have to be moved over long distances from refineries and ports to different parts of the country.
“Part of the cost of the petroleum products we are paying today is because we are trucking. Trucking petroleum products out of a down-to-earth refinery or from the ports where they are imported all across the country.”
Agule said pipelines should be used to move petroleum products instead of relying heavily on trucks, which he said adds unnecessary costs to distribution. “Petroleum products are transported by pipelines.”
He also linked the high cost of petrol distribution to the distance trucks have to cover, citing the movement of products from refineries to distant parts of the country. “Imagine a truck departing like a down-to-earth refinery’s gantry and travels all the way to Makurdi to deliver 33 litres of petrol, 33,000 litres of petrol.”
He argued that President Bola Tinubu needs to make deeper changes to NNPC rather than simply changing the company’s name from NNPC to NNPCL. “And for me, President Tinubu needs to show leadership. You know, it’s not just about changing their name from NNPC to NMPCL.”
Agule called for NNPC to be broken into separate entities and exposed to private-sector participation through the capital market.
“It is about unbundling that company and putting it on the capital market the way down-to-earth refinery is going on to the capital market.”
He said greater private-sector participation could change how the company’s assets are managed and create what he described as a genuine private-sector takeover. ““It is about unbundling that company and putting it on the capital market the way down-to-earth refinery is going on to the capital market. So that we can have true private sector takeover.”
Agule said the high petrol price facing Nigerians was also connected to the country’s dependence on trucking. “Look, part of the cost of the petroleum products we are paying today is because we are trucking.”
He also criticised the state of Nigeria’s rail system, arguing that a functioning integrated transport network would provide cheaper alternatives to road and air travel and help reduce pressure on petrol consumption.
“We need to have an integrated transport system.”
Agule said the government should expand rail infrastructure across the country rather than relying mainly on interventions such as compressed natural gas (CNG) buses and electric vehicles to reduce transport costs.
“What the president just comes up with the CNG, what is stopping Nigeria from building railways?”
He said Nigeria inherited a railway network but allowed much of the infrastructure to deteriorate, questioning why more state capitals are not connected by rail. “Why have we allowed the infrastructure that the colonialists left with us to die?”
On fuel subsidy, Agule said the government should consider bringing back a form of subsidy while tackling the criminal practices he believes undermined the previous system.
“Absolutely. So for me, the president can reconsider removal of subsidy and instead fight off the criminality that was involved in the scheme.”
He said subsidy itself was not necessarily the problem, arguing that the focus should be on preventing smuggling and fraudulent claims.
“The fuel subsidy itself was not the issue. The real issue was people were using it to penetrate criminality.”
Agule also said the government should investigate the management of refinery assets and explain the money spent on rehabilitation.
“And let us ask, the $3 billion that was spent to revamp the same refinery in Port Harcourt and the likes that is not working today, where is that money?”
He said the government must provide relief for Nigerians facing high petrol prices and should take broader measures beyond CNG interventions. “I think Mr. President needs to do more.”
Erizia Rubyjeana
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