All posts by Austin Avuru


Deregulation or Subsidy Removal?

The twin issues of appropriate pricing of Petroleum products and the (non) functioning of the downstream infrastructure (Refining and Petroleum Products distribution) have dogged the path of every Nigerian minister of Petroleum since 1992.
The then very influential Petroleum Minister, Prof. Jibril Aminu lost his job in June 1992 in response to public agitations over Petroleum products scarcity. That was the first real sign of crises in the downstream sector. Over the nearly twenty year period, no lasting solution has been implemented.

At the core of the crisis is the state of the downstream infrastructure. Our four refineries as well as the distribution network (consisting of 19 storage depots and interconnecting pipelines) were all built between 1978 and 1988. They ran efficiently in their first five to ten years, largely because they were new facilities. The first signs of decay arising from a poor maintenance culture were noticed in 1992. Since then, these facilities have steadily degenerated to the point of near-zero performance today.

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