"Ultimately, the greater challenge that this country would have and still have is that of pricing".
"Ultimately, Nigeria must aim to be the refining corridor for the whole of Africa".
The OPEC secretary general explained that the declaration of cooperation reached by oil producing countries have stabilised the oil market following the unprecedented market turbulence which had a devastating effect not only in the industry, but sometimes in the economies of OPEC member countries.He pointed out that the recent oil price drop was sharper than the decline in prices of other commodities, contrary to oil price collapse of 1985-86, when oil commodity price declined in a steep manner.
Speaking at the opening of the Nigeria International Petroleum Summit (NIPS), Buhari who canvassed support for collaboration across the continent, said the country would leverage development in the oil and gas sector, particularly downstream and boost economic growth to seven per cent.
He said the federal government's vision is to have Nigeria refine most of its crude locally, adding that Nigeria is targeting raising domestic refining capacity from 14% to 90% within 20 months.
"You still have to deal with the pricing issues, because nobody is going to build a refinery and sell products at a loss".
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Kachikwu said, "We have addressed refineries; for the first time, we are creating a model where target investments are going into the dilapidated refineries". We expect between 12 and 18 months corridor of construction and hopefully, at that point, we would get our refineries back.
"If we do all that concerning the planned investments in refineries, my position is that the business has got to change".
Ibe Kachikwu, minister of state for petroleum resources, says the federal government will NOT sell its refineries.
This summit will afford Nigeria a unique opportunity to showcase to the global community policy direction and effort of government in the petroleum sector especially the new oil and gas exploration and markets, new measures to sanitize the sector, the expansion of investment opportunities to boost investors' confidence, technological advancement, Nigerian content development, the institutionalization of reforms in the country's oil and gas industry and the galvanization of Nigeria's position as the leading oil producer in the continent of Africa.
The minister told delegates at the gathering that multinational oil firms would not be allowed to export all the crude they produce in Nigeria, as emphasis would shift to local refining of substantial portion of the crude produce in the country. "That is becoming very critical", Kachikwu noted. We have been able to, through a lot of struggle, change the funding capacity for the upstream and that had sort of energised investors in the upstream sector.
He said, "Pricing is obviously a big issue on gas, it is something that needs to be addressed just like pricing in power is also key". The private sector can not bring in the product because it does not make economic sense for them.