Corruption blamed for Nigerian oil shortages

It is called the “paradox of plenty”. Although it is the sixth-largest oil producer in the world, Nigeria has been hit regularly by fuel shortages over the past two decades.

Corruption in the oil sector is seen as the culprit. Analysts point to mismanagement of the country’s four refineries, run by the Nigerian National Petroleum Corporation.

The refineries have a combined processing capacity of 445 000 barrels a day — two-thirds of Nigeria’s daily fuel need.
However, they work below capacity most of the time and have been shut down on occasion for lack of maintenance.

“Turnaround maintenance” should take place every two years, but some facilities have operated for more than five years without it. “Under military rule, bogus contracts were given for turnaround maintenance,” said Frank Kokori, former official of the National Union of Petroleum and Natural Gas Workers. “With the usual heavy kickbacks received by state functionaries, nobody questioned contractors who didn’t fulfil their obligations. That was the start of the rot.”

Ironically, Nigeria must import refined fuel from countries such as Ghana and Côte d’Ivoire.

When Nigeria reverted to civilian rule in 1999 the new government tried to tackle the shortcomings. But difficulties remain. “We thought there would be checks and balances, and that the National Assembly would question government on why so much is spent without results,” Kokori said. “But the old system of making easy money through imports continues.”

Efforts to discover what the committee on petroleum resources of the House of Representatives in Abuja has done to investigate the refineries were fruitless.

Ishola Williams of the Nigerian chapter of Transparency International, believes graft would be more effectively probed if the Independent Corrupt Practices and Other Related Offences Commission (ICPC) were better resourced. Set up in June 2000, this body works with the police.

“The ICPC should have its own investigators, and the government should set up special tribunals to hear corruption cases,” said Williams. Currently, such cases are dealt with by regular courts, where delays are common.

Privatisation of the refineries has been mooted as another way of ensuring they operate efficiently.

The government has tried to improve fuel availability by deregulating the import and sale of refined products. But although availability has increased, so have prices — sparking protests by workers. In June, the fuel price rose to about $0,40 a litre, leading to a three-day strike. — Inter Press Service

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