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18 December 2017

Print | Text only print | Facebook  Twitter

Loss of N7.6 trillion in the Oil Industry Shocking

SPN Demands Recovery of the money and Nationalization of the Oil Industry under public democratic control and management

The revelation by the Minister of State for Petroleum, Ibe Kachikwu, on Wednesday December 13, 2017 that Nigeria lost a whopping N7.6 trillion ($21 billion) over the past 25 years to International Oil Companies (IOCs) is indeed shocking and bewildering. This is wholesale stealing of a nation's natural resource which must not be swept under the carpet.

According to Kachikwu, this enormous loss occurred because of the negligence of past governments to implement Production Sharing Contract (PSC) Act of 1993. This is criminal negligence for which not only the officials of past government but also the IOCs must be held responsible. As we all know, nothing goes for nothing under the corrupt capitalist system and there are already numerous established cases showing how multinationals and IOCs bribe government officials not to implement laws as well as rules and regulations.

The Socialist Party of Nigeria (SPN) calls for immediate steps to recover the money; prosecute the IOCs and officials of past governments responsible or who aided this swindle by their negligence as well as nationalization of the oil industry under public democratic control and management.

The amount is just a little short of the entire 2018 budgetary proposal! That amount if prudently utilized can guarantee free and functional education at primary and secondary levels at least. It can also finance the tarring of thousands of kilometres of roads and several hundreds of primary and secondary health care facilities across the country.

Simply amending section 15 of Production Sharing Contract (PSC) Act of 1993 as the Federal Executive Council (FEC) has done to enable Nigeria earn more once the crude oil price exceeds $20 will only scratch the surface of the problem. Whatever would be earned from this step amounts to pittance compared to the enormous amount that would be earned if the oil industry is nationalized and democratically run.

The bold questions the Buhari government must answer are: What is stopping Nigeria from taking control of its oil resources, explore, produce and sell its crude oil by itself? Why must Nigeria continue to rely on private investment to produce crude oil, to refine it and even to distribute petroleum products? Would it not be more beneficial to Nigeria if the country is in charge of its oil resources in order to ensure that all revenues accrues into government coffers including windfalls accruable from high crude price instead of earning just royalties, taxes, signature and production bonuses as we have currently?

As far as the SPN is concerned, what the Minister's revelation shows is that Nigeria and its people are being shortchanged by International Oil Companies (IOCs) who came to invest in the country's oil industry. On the basis of capitalism and its privatization mantra, this will continue to be the case. This is why the SPN calls for the immediate nationalization of the oil industry under to allow the Nigerian people to take control of their oil resources and administer in such a way that it benefits the working and poor people and not the rich oil magnates and corrupt politicians.

The rape of the nation's oil industry, a part of which the Minister's revelation confirms, is a product of an unholy alliance between successive capitalist governments, corrupt politicians and oil companies and marketers.

We need to put an end the capitalist system and establish in its place a socialist system under which the key sectors of the economy will be publicly owned and placed under public democratic control and management. This is to ensure that material wealth of the country is used for a comprehensive infrastructure and economic development as well as for the benefit of the vast majority of Nigerians. This is what the Socialist Party of Nigeria (SPN) stands for. Join the SPN today so we can collectively fight for an alternative to the fraud and perpetual poverty in the midst of plenty that capitalism stands for.

Chinedu Bosah
National Secretary, Socialist Party of Nigeria
Email: socialistpartyofnigeria@yahoo.com