BPE Confirms Privatisation of Refineries in 2014

                         
The Bureau of Public Enterprises (BPE) yesterday said it would privatise the four refineries in the country next year.
The bureau’s Head, Public Communications, Mr Chigbo Anichebe, told the News Agency of Nigeria (NAN) in Abuja, that the refineries’ privatisation was part of the ongoing oil sector’s reforms.

Last week, the Minister of Petroleum Resources, Mrs Diezani Alison-Madueke, had told Bloomberg TV Africa in London, that the country would privatise the  four refineries by the first quarter of next year.

Her disclosure was the second time the federal government would unfold plans to privatise its refineries.
President Olusegun Obasanjo had  approved the sale of the refineries during his administration but his successor, the late President Umaru Yar’Adua in 2007 reversed the sale of the refineries for lack of transparency in the transaction.
However, President Goodluck Jonathan in November 2012 recommended that the refineries should be sold due to inadequate financing and sub-optimal performance.

It is uncertain, however, if the federal government would take into consideration the right of first refusal which was granted business moguls, Aliko Dangote and Femi Otedola, who bought the Port Harcourt refinery in 2007, but was reversed by the late Yar'Adua.
Should the government factor this in the transaction, new prospectives bidders would have to contend with both of them.
But ahead of the proposed sale of the refineries, the Independent Petroleum Marketers Association of Nigeria (IPMAN) has urged the federal government to repair them before privatisation.

Anichebe, nonetheless, said the privatisation plans were currently at the preliminary stage, where the blueprint of the policy would be decided.
“We are working with the Nigerian National Petroleum Corporation (NNPC) and Ministry of Petroleum Resources on the privatisation of the four refineries.

“We are just in the preliminary discussion with them and very soon, we will make public the work plan for the privatisation processes, including the engagement of advisers to advise us on the transaction.
“Once the work plan is fine-tuned, hopefully by the end of the year or early January next year, the work plan as well as the schedule will be unveiled to all stakeholders, including the media,’’ he said.

Anichebe explained that the privatisation would be handled in line with the usual strategy of the bureau, which was to sell a certain percentage of shares and reserve a certain percentage for the workers, host communities and Nigerians.
He urged Nigerians not to be apprehensive about the refineries’ sale because only capable and visionary investors would be considered in the privatisation process.

“People should not be edgy about this transaction because we have done this over and over again. When we first started with the telecommunications sector, people were worried that we will give it to the wrong people.
“They were worried about the security implications and all that. I believe that whether these companies end up with local, home-based or foreign investors, what is important is the efficiency of whoever is handling it.

“The criteria should be that the buyers have the financial muscle and technical know-how to run these companies. We don’t bother about where they come from, as long as they are coming with clean money to invest in our economy.

“So, when we are doing our evaluation of investors for the transaction, that is what we will look at,’’ he said.
The BPE spokesman also said   in 2014, the bureau would also begin the privatisation of the housing sector, Abuja Security and Commodity Exchange Plc., as well as the country’s transportation sector. 

As the nation awaits details of the privatisation of the refineries, petroleum marketers under the aegis of IPMAN have urged the federal government to repair them before the selling them off.

Chairman of IPMAN, Alhaji Sule Magaji, in an interview with NAN yesterday, said: "We in IPMAN are against the plan to sell the refineries but if the federal government will not rescind the decision, the refineries should be made fully functional before being sold.
"The government should also take concrete measures to further secure all oil pipelines across the country."
According to him, repairing the refineries and securing the pipelines would motivate potential buyers and other investors to be part of the planned sale.

The– IPMAN boss also expressed his fear that the sale of the refineries would lead to total removal of   subsidy on some petroleum products.