Victor Onyegbado

Subsidy Reinvestment: Conspiracy against the urban poor?

2012-01-16T07:37:00.000-08:00

In our country,government officials a wont to be politically correct at all costs. Even civilservants here have in time past been sworn to costra nostra like oaths of secrecy. Mallam Sanusi Lamido, ourCentral Bank’s governor, is however not a member of this class ofstraight-laced elites of whom the late Fela Kuti sang zombie o zombie. For instance, in an article on why he supportsgovernment’s deregulation policy, the good mallam opined that the phrases“average Nigerian business man” and “Nigerian entrepreneur” are “politeeuphemisms for rent seeking parasites”. He however went further to say this; “I am not complaining about insults –I amused to that. I just believe that an insult is not an argument and when peopleresort to personal abuse, they have run out of logic”. Touché!!!

Frank talk maybe a costlier commodity than its unqualified brother but it is cheapnonetheless. For Mallam Sanusi to believe that PMS is just “fuel used by the middle class to drivearound town and from city to city; not to employ workers and produce goods andservices” leads one to suspect that –In spite of his sincerity– he is farremoved from the plight of ordinary Nigerians. Our CBN governor thinks that all“those speaking now on the internet andon Facebook and Twitter and newspapers are not workers but middleclass elitewho use PMS in their smart cars”; for which cause he admonishes us to “stop all the ideological pretenses”.Perhaps one needs to point out to Mallam Sunusi –and the rest of the folks advisingPresident Jonathan– that the reason why modern-day protests are characterizedby a huge presence in the social media is the cheapness of that media; not tomention the government-imposed restrictions with regards to traditional formsof mass mobilization. It is –and one make this point strongly– not a matter ofsome elitist social standing.

One should alsopoint out to the CBN governor that there are today, in the Orile-Iganmu,Ajegule and Mushin slums of Lagos perhaps tens of thousands of young peopleholed up in thousands of make-shift music studios, all working hard on theirlyrics and rhythms and dreaming of becoming the next 2face Idibias or DaddyShokeys or Mike Okris. These people rely on PMS for their businesses and I donot reckon that they qualify as “middleclasselite who use PMS in their smart cars”. The barbers, the vulcanizers, the street photographers, okada riders, and bukatariaowners all also rely on PMS –little thanks in part to PHCN. There are, in everyone of our cities, millions young graduates, working hard on their first jobsever, who spend close to 60% of their monthly income on transport fares alone.These were the folks whose voices –or should I say status-updates and tweets–rang loudest on Facebook and Twitter. And yes, they were also joined by theirdisgruntled friends who –as a result of the prevalent unemployment in the land–haveresorted to fraud by emails aka Yahoo-Yahoo as full time employment. I think the Lamido Sanusis of Nigeria need topay some attention to these people.

I write thisrejoinder not because I seek to highlight what the CBN governor missed out inhis article. No, I write because there appears from Goodluck Jonathan’s SubsidyReinvestment and Empowerment Program (SURE-P) a conspiracy against the urbanpoor; who –I posit–have been wrongly lumped together with “middleclass elite who use PMS in their smart cars”. It appearsthat, rather than empower this class of Nigerians, SURE-P seeks to annihilatethem. To be sure, the proposal provides for such things as cash grants to ruralwomen, maternal and child care programs for the same said rural folks, agricloans, mass transit intervention schemes and road rehabilitation projects. Savefor the mass transit scheme, which I reckon will –like the proposed railprojects–have an inter-state or long distance focus, there are no short term palliativesto subsidy removal for the urban poor in SURE-P. Conversely however, it is thisclass of Nigerians who will bear the brunt deregulation the most.

Rural folksspend little of their income on transport and even the costs of transportingfarm produce to markets are ultimately borne by the urban consumer population.So as transportations costs escalate for everyone, the rural population defraysit on the cost of their produce and this in turn leads to increased food costsfor urban folks alone. Throw in the fact that the subsidy on Kerosene –a fuelused by 89% of the urban population of Lagos for instance– has also been removed;it becomes alarming that nothing has been proposed on SURE-P to carter to theurban poor. These folks will pay more for their transport, food and householdfuels while their incomes will remain static. They will also sit back and watchas cash grants are doled out to rural women. Call it baboon dey suffer monkeydey wack and you will be spot on.

YouTube - Video Evidence Of Election Fraud In South-South Nigeria.

2011-04-14T12:21:00.000-07:00

YouTube - Video Evidence Of Election Fraud In South-South Nigeria.

The High Cost of Getting High

2011-04-08T07:50:00.001-07:00

Aviation Turbine kerosene; also know as ATK or Jet A1 is what aircrafts consume so copiously in other to get high. It used to be, in this country, and still is, in some other climes, a relatively cheap fuel. Perhaps this can be illustrated by recalling a story once told by the BBC’s Louise Greenwood, of the thriving but illegal brewing markets in some African countries. Ms. Greenwood had reported that about half of all the alcohol drunk in Sub-Saharan Africa is produced illegally, with Kenya (85%) and Tanzania (90%) topping the chart of illegal booze drinkers.

The booming cottage industry of clandestine breweries is mainly sustained by the fact that legal booze, on account of heavy taxation, is very expensive. Thus with the illicit alternatives selling for less than 20 US cents per glass, Africa’s poor, most of who earn less than a dollar per day, have no other way of “bottling out their troubles”. As the story goes, African moonshine, with names like "Kill me quick", "The dog that bites" and "Goodbye Mum", has a frightening reputation. Thousands of people have been killed, blinded or rendered sterile from drinking lethal concoctions, which in some cases had had their alcohol content bolstered with such odd things as embalming fluid and… (get ready for this)

AVIATION FUEL!!!

The underground brewers of Kenya and Tanzania must take the idea of getting high way too seriously.

Some cold comfort is however offered by the fact that nowhere in Ms. Greenwood’s story is a Nigerian numbered among those who adulterate “Kill me quick” and “The dog that bites” with Jet fuel. Had that been the case, a most unusual party would have joined Nigeria’s ever recurring aviation fuel price war. Yes, our local airliners would have had not just fuel marketers, but illicit booze brewers, to contend with as well.

Indeed Nigerian local airline operators and their fuel suppliers make a most quarrelsome and controversy loving couple. The rest of us Nigerians who commute on domestic routes; and even those who use Household Kerosene (ATK’s twin sister) for cooking and lighting are the traumatised off springs of this union. In the last one year, there have been, apart from the present one, two major fights and perennial squabbles between these two. In January 2009 the fuel marketers (as they have done again this time around) hiked the price of jet fuel from around N80 to as much as N160/litre in some parts of the country. The airlines, who claim that fuelling alone gulps as much as 50% of their operational costs, cried blue murder. They made it clear to everyone that there was no way they could meet their financial obligations with such pricing in place. It took the intervention of the Nigerian House of Representatives committee on aviation to resolve the matter. A meeting of all stakeholders was called and in less than 2days, prices went back down to N80. Not a few people wondered if there was cogent justification for the hick in the first place.

August 2009 was yet another occasion for conflict. In fairness to all concerned, those were indeed very demanding times. A certain Lamido Sanusi, who had just taken over the reigns of leadership at the Central Bank of Nigeria (CBN), was carrying out systemic environmental sanitation. Some of his actions ensured that credit facilities, particularly those to fuel marketers, became pipe dreams. So with no loans coming from their bankers, the fuel marketers again took it out on the airlines. They replicated the general attitude of banks at that time, and thus jet fuel became cash and carry commodity. Tales of how airlines would collect fares and check in passengers before placing cash backed fuel orders right on the tarmac may sound amusing now, but they weren’t so back then.

by Victor Onyegbado

Mr. Victor is the Editor of OTL Downstream Newsletter (a free Newsletter for Oil trading and logistics)

To subscribe for the newsletter please go to www.otlafrica.com

Cargo Tracking Note Palava

2011-04-08T07:49:00.000-07:00

Hardly had the Nigerian Ports Authority (NPA) announced its plans for implementation of a Cargo Tracking Note (CTN) regime than it became apparent to all that an epic battle (of sorts never witnessed in the industry before) was upon us. Virtually all ports stakeholders were at daggers drawn with the NPA over this CTN issue. I must confess (at the risk of being labelled warmonger) that I eagerly looked forward to the showdown. What, with ports users perpetually grumbling about the various illegal charges being collected at Nigerian Ports, (for no value whatsoever added) the time had come. Enough was enough. Finally it was going down.

By mid January, I had written what I believed was my 6 page precursor to full fledged war time reporting. It was titled “The Audacity of Nope”. Fast forward to April 2010 however, the CTN battle has been completely averted. All the various groups who had been opposed to its implementation are now locked in the sweet embrace of the NPA while rendition after rendition of “CTN, How Wonderful Thou Art” are offered daily by both parties on the pages of newspapers.

But how could something so wonderful have caused so much rouse? In its early days, there was much talk about how the CTN would make Nigerian ports; which are said to be among the most expensive in the world even more costly. A cross section of stakeholders for instance initially maintained that the levies which the CTN attached to all inbound and outgoing cargo would increase costs, lead to smuggling and thus diversion of much employment from many within their ranks. There were also concerns that the CTN would add another level of bureaucracy to a cargo clearing process which in its current state already contributes to the problem of ports congestion. Yet again, how Antaser Afrique (NPA’s sole representative for the CTN implementation) emerged was also called to question. Where in the world was due process?

In this entire melee, the NPA felt it necessary to address just one of the concerns and it appears that this has been enough. The authority explained that contrary to apprehensions, the CTN added no extra charges which were not already being paid by importers. NPA’s General Manager Public Affairs is reported as having declared that:

…everything is paid for right from the port of origin but shipping agents have over the years been collecting the monies and never remitted them.

So reassured by the above explanation, most of the hitherto nay Sayers have abandoned their agitation. In fact some groups are reportedly at war with the recalcitrant few who are yet to come on board. My 6 pages are forever condemned to some small sectors of my computer’s hard disk space. I lick my wounds. My grief is however heightened by the fact that we may have lost the best opportunity yet to present it self for tackling the issue of multiplicity of illegal charges at Nigerian ports. Other questions such as the true relationship of the CTN with the International Ships and Ports Security (ISPS) Code and also whether it is really the brief of the NPA to implement a cargo tracking system in the light of the functions of other government agencies would all have to wait. For now CTN has the floor.

Victor Onyegbado is a Lawyer and a Maritime Industry Analyst.

He is the Sub-Editor of Marine and Petroleum Nigeria Magazine.

Ports Puree

2011-04-08T07:47:00.001-07:00

Ports Puree

By Victor Onyegbado

"When I reflect, as I frequently do, upon the felicity I have enjoyed, I sometimes say to myself, that were the offer made me, I would engage to run again, from beginning to end, the same career of life. All I would ask, should be the privilege of an author, to correct in a second edition, certain errors of the first." Benjamin Franklin

I recently had to represent a client in a libel suit brought against him by a freight forwarder (aka clearing agent). Now, a lengthy code of professional conduct for legal practitioners will not permit me to share the juicy details of that case with you in this format. However I suppose no harm is done, if for the sake of evaluating our ports, I divulge albeit skeletally, some relevant particulars of my case. Here goes.

Several invoices issued by the clearing agent to some of his own clients had been tendered in evidence. The clearing agent, who prior to this time had given evidence of his good character, his social status and the fact of him being a devote Christian was then led through identifying his signature on each of these invoices. He gladly obliged. His attention was then drawn to the some particulars contained in the invoices. Things like:

Resolution of low duty query as agreed---------------------------------------------------N70, 000

SON inspector; in lieu of sample ------------------------------------------------------------N80, 000

Fumigation of pallets by quarantine in lieu of N80, 000 Bank draft payment-----N30, 000

NAFDAC Release in lieu of import Permit-------------------------------------------------N50, 000

The follow-up question thereafter was;

Sir, do these point to the ordinary business conduct of devote Christians; people of good character, or do they on the other hand, warrant a petition to the EFCC?

His lawyer objected promptly but it was too late. The damage had been done. The man was thoroughly embarrassed.

Of course I do not seek to imply from the above that all of Nigeria’s freight forwarders are dubious persons. Quite the contrary, I know many who are decent and honourable men. The problem however lies in the fact that the concept ofsettlement is very well institutionalised in our ports. All the stake holders in that sector (the Ports Authority, the Nigerian Customs, clearing agents and even the importers) are involved. Most lawyers who represent cargo interests are familiar with the difficulty one experiences while trying to convince clients with valid claims (against say the Nigerian Customs or NPA) to seek legal redress for these claims. The usual reply that one will get to ones very well-articulated legal opinion is:

“Lawyer, how can you ask me to sue government? Do you want them to target all my subsequent consignments? It is better to just settle them and then get on with business”

Perhaps, more worrisome than settlement is the issue of multiplicity of government agencies at the ports. In June 2010, a Ministerial Task force set up by the Minister of Transport to fashion out ways to attain efficiency in port operations identified 13 different government agencies working at the ports. The Task force which was headed by Mrs Chinwe Ezenwa, a Deputy Director in the Ministry of Transport, noted that all of these agencies were participating in the cargo clearance process thus making the process cumbersome, inefficient, slow and very expensive. Some of the identified agencies at the ports are:

• Nigerian Ports Authority

• Nigerian Customs Service

• Nigerian Immigration Service

• Nigerian Police Force

• State Security Service

• National Agency for Food, Drug and Control

• National Drug Law Enforcement Agency

• Port Health

• Veterinary Quarantine

• Plant Quarantine

• Federal Produce Inspection Service

• Directorate of Naval Intelligence; and

• Standard Organisation of Nigeria.

As if these are not enough more are springing up daily. The activities of two of the new entrants ruffled a quite a few feathers very recently. The agencies in question are the National Environmental Standards and Regulations Agency (NESREA) and the National Task Force to Combat Illegal Importation of Goods, Arms, Ammunition and Light Weapons (NATFORCE).

NESREA in execution of its campaign to rid Nigeria of what it terms e-waste recently embarked on a spree of detention of container ships which were alleged to be carrying toxic wastes. The toxic wastes turned out to be used electrical and electronic appliances. This state of affairs has led major shipping lines and their agents operating under the aegis of the Shipping Association of Nigeria (SAN) to suspend the carriage of used electronics destined for Nigeria. While it is important to point out that used electrical and electronic appliances are not included in the Nigerian Customs Prohibited Import List, it is also important to note the implications of NESREA’s actions. The secretary to the Association of Importers of Used Electronics (AIUE), Alaba International Market Chapter Mr Andy Okoro captured this when he opined that:

Any Nigerian who intends to import used electronic items such as television sets, radio, DVD players and I-pods even as personal effects from any part of the world may now not be able to find a shipping line that will be willing to ship his consignment into the country.

It is my hope that the legality of NESREA’s actions in this regard will be tested in a court of law. This may never happen however, as the suing of government is the beginning of trouble for your next consignment.

NATFORCE is another new entrant to the Nigerian ports racket. It’s Deputy Chairman, Commissioner of Police Edwin Tonkmor (Rtd), while on a courtesy visit to the minister of commerce and industry recently gave a recap of events that led to its establishment. He pointed out that in order to absolve itself of any culpability for the importation of illegal arms and goods into Nigeria, the Importers Association of Nigeria (IMAN) seized the opportunity of a Public Private Partnership (PPP) to collaborate with the Federal Government through the Ministry of Finance and other agencies to set up NATFORCE in July 2010. The mandate of NATFORCE according to CP Tonkmor (Rtd) include to identify sources and main routes of small arms, ammunitions, light weapons and general contraband as well as monitor, control, halt and mitigate illegal activities by unscrupulous persons, companies and organisation.

The last time I checked, most of what Mr Tonkmor described fall squarely within the jurisdiction of the Nigerian Police, The Nigeria Customs and State Security Services. But then we are talking about Nigerian Ports here. Who cares about such trifles and niceties as jurisdiction and statutory authority? The taskforce now has its own checkpoints mounted around our ports. When you are done with customs please don’t forget NATFORCE.

The reader may wish to recall that the huge number of government agencies, at Nigeria’s ports expressly violates the recommendations made by the Joint Intelligence Board (JIB) in June, 2003 to the effect that only five agencies are required at these all-important national gateways.

All of the above added to a host of other sundry issues (100% physical examination of most cargos for instance) contribute to ensure that our ports get ranked very low even by African standards. Ships and Ports Newspapers recently reported that no Nigerian port is currently listed among the top 125 ports in the world. With navigable inland waterways of 30, 000 kilometres, eight major seaports, 11 oil terminals, over 170 private jetties as well as four major inland container depots (ICDs) and a cargo generating economy, this score is very unbecoming of Africa’s giant.

Recently, the Federal Government delisted many items form the imports prohibition list. While that is not my concern here, I must point out that if as has been widely reported, the delisting reflects a political will to curb the excesses of greedy customs officials, then at least with respect to the problem of settlement, hopes are rising. Other highlighted areas need also to be addressed with the same doggedness. At this dawn of the second decade of the 21st century, we can resolve to correct, in the second edition, certain errors of the first. We can also choose to forgo the privilege of being authors for playing the part that we are so very used to.

2011-04-08T07:42:00.000-07:00

A Tale of two Sisters

by Victor Onyegbado (Published in Marine and Petroleum Nigeria Vol 5 Issue 15)

It is not what happens to you that determine how far you go in life; it is what you do with what happens to you. This statement by Zig Ziglar remains a nourishing food for thought for all times. Particularly for those who have been observing the marriages of two West African damsels (Nigeria and Ghana) the wisdom encapsulated herein resonates ever so loudly.

Sisters of same British parentage, our damsels have at different times in their lives been married to Petroleum; the richest and most charming prince in the entire world. He had promised both fortune and fame and at least with regards to Nigeria the prince has kept his word. Ghana's marriage on the other hand has just been consummated. Save for a quick divorce (in the event that she is found to be barren) Ghana’s fortune is also a surety. But how will the sisters fare in this odd polygamy? Will Ghana handle her affairs the way Nigeria has?

The younger of the two sisters, Nigeria had the good fortune of catching the eye of the prince first. After several years of courtship, the love birds finally got married in an elaborate wedding at Oloibiri, Niger-Delta. The year was 1956 and the officiating minister was Shell-Bp.

And so it happened that young Nigeria ascended to stardom. By 1975, she had completely jettisoned the down-to-earth agriculture lifestyle of her childhood to adopt instead, pomp and pageantry of the classy socialite. Nigeria dazzled. She became the toast of world events; a card carrying member of such exclusive elite clubs as OPEC. In the 1980s, Nigeria took for herself the chieftaincy title of Giant 1 of Africa.

Recent events however reveal that behind the veil of glamour, Nigeria suffers from acute anorexia. Now 50 years old and mother to some 140 million children, Nigeria’s addiction to very expensive cosmetics is also legendry. Her routine mortgaging of large chunks of her fortune to finance this addiction has led to serious agitation from some of her children. Particularly from those most proximate to the treasure trove, the war against mum campaign rages on. The depths to which Nigeria has fallen became glaring when at the turn of the century she led the world’s poorest mothers, cap in hand, to seek for debt relief from the people who otherwise are less naturally endowed than she is. How are the mighty fallen.

Now the prince, irked by all the shame brought upon him by Nigeria (in spite of matrimonial rules relating affinity) sought the hands of Ghana in marriage. On the 15th of December 2010, at an offshore location known as Jubilee fields, the new couple was wedded.

Ghana has spent much of her honeymoon consulting with diviners, marabout and marriage counselors. But as the saying goes, the best things in life are free. Ghana only has to diligently observe some home truths in order to have marital bliss. She must never forget where she is coming from. She must avoid greed and she must take care of the kids. Classic examples of how to waste a good fortune lie eastwards at her sister’s doormat, but Ghana must rather look westward to total strangers (Canada, Australia and Norway) for how not to waste her fortune.

Victor is a Maritime Lawyer based in Lagos Nigeria.

He is the Editor of OTL Africa Downstream Newsletter and also the Sub-Editor of Marine and Petroleum Nigeria Magazine; the Nations foremost Maritime and Petroleum Industry Journal.

The Lagos Shipping Club | on board onward

2011-04-08T07:29:00.000-07:00

The Lagos Shipping Club | on board onward

Eating Dog

2011-04-06T01:17:00.000-07:00

Eating dog

By Yemisi Ogbe

It is exactly over familiarity with the dog that in my case breeds my utter contempt for the idea of eating dog meat.How I am possibly expected to eat some domesticable constantly salivating animal that smells like a dank rug, eats its own fecal matter, licks its privates and has the capacity to exercise an uncanny intrinsic intuition, is beyond my culinary comprehension. It just does not feel right to eat dog.

It does not therefore follow that I am one of those people who would sleep in the same bed with a dog, play chess with the dog and then take it to the South of France on holiday. I have absolutely no desire for dog companionship. I have not yet even perfected my fellowship with human beings. If there is something hypocritical about attempting to determine which animal to eat or not to eat by the animal’s intelligence, affability to human beings, hygiene and other unpredictable parameters then let it be so. And by the way, I have the utmost respect for the moral courage or self-righteousness or strength of conviction or whatever, that it takes for the vegetarian/vegan to say an unshakable "No" to placing himself at the apex of the food chain and eating everything beneath him. Until further notice I am a meat eater, not a liberal one, but nonetheless one.

My sensibilities are easily offended and I still constantly wonder whether since one is not eating dog, one should also not eat pork since pigs are said to be the most intelligent “domestic” animals in the world, and since George Orwell’s allegorical Animal Farm considers them so intelligent to be worthy representatives of our domineering and presumptuous humanity.

The reality is that Nigerians eat dog, and to the degree of “well well”. In the same manner that we eat monkey and horse and camel and deer, and goat and beef, whatever meat presents itself and appeals to us. It is probably more psychologically honest and healthy to admit this than to say one eats one meat and not another. We Nigerians generally tend to have a nonjudgmental straightforward relationship to our meat. We have the capacity to view the slaughtering of the animal and still eat its meat without any iota of remorse. As harrowing as it may be for someone from another culture to be presented a dish called Isi-Ewu with eyeballs, brains, tongue and parts of the skull of a goat so brazenly tossed with vegetables, to us it is completely commonplace, and completely delicious.

I believe that people like myself who have urban dwellers’ hang-ups about eating dog are in the context of Nigeria, a minority. Dog meat is being consumed in Plateau and Gombe, in Akwa Ibom, Cross River, Abuja and in Ondo, and these are only the states that are consistently documented. In Cross River State, dog meat is affectionately referred to as 404, where it is a serious delicacy. Sit-outs on Hawkins Street in Calabar South, and in an area called Adiabo are renowned for their dog meat prepared in special sauces. Dog is not cooked in stews, since like Isi-Ewu, or Suya, it is the not an accompaniment to a meal, rather a delicacy deserving of all the attention worthy to be paid a main course. People who go to the mentioned joints often do so specifically to eat dog.

Why 404? I asked Nsor Nyambi, whose witty exposes on Calabar and Cross River have helped me navigate the culture as well as have a good laugh. “...Because dogs run with speed like the 404” he said.

The 404 is of course the Peugeot sedan (“pijo” in Nigerian lingua franca and “piyot”, soft “t” in CrossRiverian articulation) that my generation caught a passing glimpse of before the more enduring 504. At the time, the 404 sedan was considered very fast indeed, and when Crossriverians were searching for a worthy comparison for the speed of a running dog, 404 was the exaggerated equivalent. And I suppose there is some wicked irony in terming a type of meat running meat; running as fast as a car, yet not outrunning the eater.

As to whether Nigerians who eat dog are 100% comfortable with the idea, I wonder why if it is so, that no one I have asked if they eat dog has ever given me a straightforward “yes”. It is always “those Akwa Ibom people” or “those Ondo town people”. And those rare people who admit to eating it don’t do so without looking mischievous, and they never just eat because they enjoy doing so. They eat it because it is a cure for malaria, or it wards off Juju or it improves your sex drive...

Charity begins abroad

2011-03-31T05:10:00.001-07:00

Charity begins Abroad
by Victor Onyegbado

The Ping Game
Chatting with a bunch of friends on the internet a while ago, I sought opinions on the NNPC’s recent decision to become an offshore petrol refiner vied a partnership with Brazil’s Petrobras. Almost everyone was critical of the move. The common argument went thus:

…to add value to our economy and to create jobs for the army of unemployed but qualified youths we should be doing the refining in Nigeria and not in …Brazil or USA.
One of my chums even crunched out figures to buttress his submissions on where Nigeria’s priorities should lie at this time. I reproduce the same figures here for your consideration and in fairness to him as well.
Brazil’s domestic oil consumption was 1.85 Million barrels per day (Bpd) in 2005. At the same time, its national oil company Petrobras was producing 1.68 Million Bpd of refined products. The country now has about 1.9 million bpd of crude oil refining capacity spread amongst 13 refineries. Petrobras operates 11 facilities.
Nigeria on the other hand consumed approximately 280,000 bpd of oil in 2009. The country has four refineries (Port Harcourt I and II, Warri, and Kaduna) with a combined capacity of around 500,000 bpd. As a result of poor maintenance, theft, and fire, none of these refineries have ever been fully operational. Industry analysts estimate that 0-15% of the refining capacity was operational in 2009.
The Quick and the Dead
Now, in spite of the above, my views on this issue are not as radical or extreme as those held my friends. I appreciate the fact years and years of grappling with scarcity have carved charity begins at home right into our bones. Yet, this Brazilian connection appears (to me) a more viable option than the 25 or so Greenfield refineries that we’ve been expecting for donkey years now. Indeed, we live in times when threats of non-renewal of oil mining licences by the Federal Government of Nigeria fails to move even a single IOC to make serious commitments towards local refining. After all (as wikileaks reveal) Shell has seasoned people in every major department of the Government of Nigeria.
The truth is that (and I have said this quiet often) no one is in a hurry to build any refinery in Nigeria. While the way we price our petrol (PSF or Subsidy) is a militating factor, there are even more serious clogs. The excess global crude oil refining capacity is one. Christof Ruehl, Chief Economist at BP Plc. was reported recently as saying;
There has been a rise in unused refining capacity globally to about 20%, which is likely to last through 2030 now that demand from Organization of Economic Cooperation and Development Countries has peaked...
Refiners all around the world are battling with ever shrinking margins. Additional refining capacity in traditional consumer areas is therefore no joking matter for them. Most of the people to whom we run for establishment of local refineries already have interests in overseas ones which could be prejudiced. Here then lies the difficulty being experienced by Nigerian entrepreneurs in sourcing foreign financing for private refineries. Simply put, your landlord will never build a house for you.
The Solo Way
The logical route out of the above problem would have been to download some Do it yourself or Dummies guide to refining books off the internet and get on with the business as architects of our own destiny. But then, construction of refineries is very capital intensive. Yet again, the track record of our very own NNPC in this area is not such as to warrant the committal of another 10 kobo to it; if its proposal is to go solo. So where do we go from here?

Coming to Brasilia
The details of how exactly the NNPC seeks invest in Petrobras’s plan to expand its refinery in Texas, U.S., from 100,000 barrels to 200,000 barrels per day are yet unknown. However, statement s made by the corporation’s Group Managing Director can afford us a rough guess. Mr Oniwon said:

We indicated to them our interest to partner with the company to have an outlet into American market instead of exporting just crude to the American market. We can take Nigerian crude, which is also going into American market anyway, into this refinery, process and sell as value added product into the American market.

From the above, my guess is that NNPC’s proposal is some kind of Crude for Stake arrangement with Petrobras. If this is the case, then I think it is a win-win (at least in terms of earnings to the NNPC). Now before you reel out the litany of how this arrangement does nothing in aid of energy insecurity in our country, please consider what the alternative would have been. Surely, another proposed brand new refinery in say Akpabuyo Cross-River State will not do much in that regard either. The NNPC already has 10s of such utopian agreements and MOUs with a host of people.

I’ve got you babe
The choice of this particular refinery in Texas may also have been strategic. Petrobras acquired 50% stake in it in 2006 and from the outset nursed intentions of expanding its capacity. However a 2008 arbitration award forced the Brazilian company to acquire 100% of the refinery from Astra, its estranged partner at the time. It may very well be that the chunk of cash required for total takeover of the refinery made the Petrobras a bit more perceptive of the NNPC’s proposal.

And it’s a wrap
If you listen to rap music, you must have heard Jay Z say:

I was dealt a bad hand so what else could I do? …but keep something up my sleeves to help me through.

I think the Brazilian connection was as good a bargain as the NNPC could have gotten in today’s world circumstances. Considering that building of new refineries involves a lot of money and also creates relatively few jobs, this was worth the taking. I may be wrong but only time will tell.

Noting doing

2008-09-30T11:46:00.001-07:00

U got that right. Noting doing

Over due process

2008-09-30T03:48:00.001-07:00

This morning i read 4 paper say oga VP don blast one guy so wey be Acting Director alias senior house boy of Nigerian Institute of Policy and Strategic Studies.(NIPSS) Dr.Yakubu Sankey.
VP talk 4 oyibo say Dr.Sankey b "a man not to be trusted with the sober demands of high office" ukpabiaeh!
Wetin cos dis katakata na as Dr.Sankey take go 4newspaper talk say VP been sabotage d autonomy of NIPSS. Egbudu!
The tori be say i get one man, Mr.Brigss way be Assistant director(that is junior house boy) for dat NIPSS too. Dr.Sankey and one administrative panel been don suspend Brigss sake of say they talk say im thief another man camera wen they been go training tour for China. Na wah o!
But as the tori reach VP ear im come talk say make they cancel the suspension and return 2status quo ante. Oyibo!
For the same statement way VP use blast Dr.Sankey, VP talk say as na only court fit talk weda or wedan't Mr. Brigss thief the camera true true, Dr. Sankey and im kwekwe administrative panel been act ultra vires...

Ill dad.

2008-09-28T13:51:00.001-07:00

In hiphop... we say something is ill... wen its really hot... Wen its brilliant... and better than good... Like u'r ok... but ur flow's ill... Did u Get dat?..
Now my dad's ill.. and this aint hiphop... Am bloggin this from... next 2 his bed side... I want 2 rhyme this... But this is too real... This aint poetic... His image i mean... How can i rhyme that... Cant hiphop that...
I think back 2 wen...
he used 2 woop my ass... Now he's all frail and there's a role reversal... Am playing pops now... Am popin ma pop... This aint hiphop... so i aint shooting him... The doctor do the popin... The hiphop type...

All i see is pain... And maybe fear too... I see cancer... I see accidents... I see amputees... a man cant eat... cos of throat infection...
So where's love yo. I think i found him. Or is her though... whatever screw gender...I found love here... In a hospital ward...Among pain and fear...Like choice gold in d mud...
I love daddy... So get well soon

Tic Tuc

2008-09-27T10:37:00.001-07:00

I wake up to news of top jobs lost.
The worlds number ones cant seem to hold on to there scepters.
Them say 9ja's Baba go slow is slowly heading for resignation. (no ask me who talk, ask channels).
I also hear say Gordon Brown's taking plenty plenty heat. Hope im no go soon resemble madam Browns brakefast toast.
Meanwhile the south africans aint as patient. I hear na red card! boot! get the f%*k out! to Mbeki.
Na wah o! Who be nest?