The President of the Trade Union Congress (TUC), Festus Osifo, on Tuesday dismissed claims that Nigeria’s state-owned refineries never worked.
Osifo, who spoke on Channels Television’s Politics Today program, explained that the problem was not inactivity of the refineries but inefficiency.
He, however, posited that the country’s refineries were shut because they were operating at a loss, urging the Federal Government to give private investors controlling stakes in the refineries.
“I’m an engineer of over 20 years’ standing, and I understand how mechanics work. So I know a system that is working, and I know a system that doesn’t work. I listened to a programme that said the refinery never worked. It’s not correct, the refinery worked,” he said.
Speaking on his visit to the Group Chief Executive Officer of NNPC Limited, Osifo said the union was told the shutdown was due to “Material balance”.
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“There is a difference between a piece of equipment working and a piece of equipment working efficiently. In engineering, these are two different things.
“When you feed crude that costs 10 million dollars into the refinery and end up with products worth about 9.5 million dollars, it means you are running at a loss. That was exactly what happened, not that the refineries were not working.
“The material you feed into the refinery and what you are getting out was reduced in terms of value. So that was why they shut it down to restructure the strategy.
“When those refineries were working 15 to 20 years ago, the old refinery was feeding products into the new one.
“The new refinery would then refine, for example, PMS, to the right specification. But the government wanted a quick fix by separating both units, which created a material balance challenge.
“What we have advised, and what we have advocated for in the last 20 years, is that the government should give private investors a 51 per cent stake in the refineries.
“Once they become the largest shareholders, they will be able to run them efficiently,” the TUC president said.
