The Federal Government has been advised to create policies that would encourage private investment in the nation’s oil and gas industry.
The Managing Director of Masters Energy Limited, Mr Uche Uduah gave the advice when members of House of Representatives Committee on Petroleum Resources (Downstream) paid a visit to the yard in Port Harcourt’ Rivers State recently.
Citing the Amakpe Refinery in Akwa Ibom State as an instance, Uduah said somebody started that project and nobody could encourage him adding “what if he had spent all his life savings on that project, the whole thing would have gone down the drain?
He disclosed that Masters Energy was ready to build refinery as it has over 143 hectares of land for that purpose but there should be a policy in place that would support private investment. Mr Uduah said that privately owned refineries are the solution to the problem of fuel scarcity in the country he said.
“There should be 100 percent deregulation to allow for a level playing ground for all operators, even if it is a guided deregulation. I do not want government’s subsidy in any kind. If you buy you sell; if I buy l sell”.
Commenting on the firm’s challenges, the MD said “before now, it was adequate allocation and now is funding adding that nobody wants to give you money. According to him the banks are also afraid because of the Central Bank’s policies, so nobody wants to invest.
He explained that Premium Motor Spirit (PMS) constitutes 80 per cent of their business and added that if there was PMS over 500 trucks would be queuing up to load the product saying that despite the bad road trucks will come as it was closer to the north.
“The issue is that everybody is seared even the foreign investors. Nobody is sure that if they give you money that they would be able to get back their investment or if they give you products, they will get their money”, he stressed.
On insinuations of the existence of cartel in the industry, he said,” there is nothing like cartel, the business is about turnovers. Any marketer that has products must sell because the more turnovers you make the more money. What has been happening is NNPC’s supply and swap. Let them give you the analysis of what is the actual value since the beginning of the year”.
He also disclosed that the firm was building a $10 million fabrication yard in Port Harcourt which will be ready in January 2013.
The MD said, “Masters Energy is always thinking ahead. We do not wait for government policies. We have already started a fabrication unit which will be ready by January 2013. We want to see how we can play successfully with logistics and fabrication”.