The year 2012 has been a mixed grilled for Nigeria in its energy sector. This is so because the experience during the last year under review has been a combination of the “good” and the “bad”, though the  bad seems to be dominating the “good” therefore having remarkable impact on the nation’s economy.

This impact, naturally tilt this piece to reflect on the “bad” in the sector.

Nigerians woke up on January 2012 to the ugly reality of the removal of fuel subsidy which led to the astronomical increase in pump price of petrol from N65 per litre to N140 per litre. This sparked a series of protest across the country which crippled economic activites thus forcing the federal government to resort to partial deregulation by pegging the pump price of petrol at N97 per litre. This, off course, obtains in some parts of the urban areas with close monitoring as in rural areas and most parts of the rural parts of the country that are not closely monitored sell between N120 to N160 per litre.

No doubt the oil and gas aspect of the energy sector which has shrouded in darkness was to some extent unshrouded by the various probe reports from the Nuhu Ribadu’s to Dotun Suleman’s and Kalu Idika’s that were set up in the wake of the protests that greeted the subsidy removal.

There have, however, been spirally controversies clogging the implementation of these probe reports inclusive of the one carried out by the Farouk Lawan’s House of Representatives ad hock Committee on subsidy payment.

The reports by Farouk and Ribadu generated heated arguments for and against due to the revelations that emanated from them.  While the Farouk’s Committee report was tainted by the $620,000 bribery alleged by Femi Otedola, the Ribadu’s committee report though openly challenged by two members of the committee who accused him of not doing a thorough job made open some starkling revelation that left Nigerians dumbfounded.

Also, the Petroleum Industry Bill (PIB) that was compiled by Senator Udo Udoma’s committee before being sent to the National Assembly was strongly opposed by the Northern Senators and International Oil Companies. These were the same factors that resulted to abortion of previous PIBs. Recent reports have it that the House of Representatives has postponed the hearing on this controversial bill to between the third and the fourth week of January 2013.

The indictment and prosecution of several petroleum marketers in respect of fuel subsidy had the resulted effect of the perpetual scarcity of petroleum products in many cities across the country as these marketers who cushion government’s importation were not importing. Nigerians, inadvertently bear the brunt as government’s importation alone cannot meet up public demands.

Also of note is statement issued by Nigerian Association of Petroleum Explorationists (NAPE) at its Annual International Conference and Exhibition in Lagos recently that the nation’s potential of generating about 2.26 metric tones of Liquefied Petroleum Gas (LPG) annually will never be achieved unless issues of infrastructure deficit and lack of access to finance of players in the sector were addressed.

The statement, said the attainment of the nation’s vision 20:20 objective can only be achieved with stable power supply with gas production playing important role.

The statement presented by Mr. Mustapha Jibrin further noted that recent discoveries in other parts of Africa was negatively affecting Nigeria’s natural gas potential and its competiveness.

“The competitiveness of Nigeria’s natural gas and the numerous opportunities… it would be impacted by recent discoveries of large reserves of gas in other parts of Africa, especially offshore East Africa, as well as huge exploitation of shale gas in different parts of the world,” the statement reads partly. The country reveals a poor state of services amidst a monthly outrageous bills. This is inspite of all the news about the implementation of power sector reform such as the increase in electricity tariff, privatisation of generation and distribution companies as well as the management takeover of the Transmission Company of Nigeria by Manitoba, a Canadian firm (a deal which has a lot of controversies). Earlier this month, it was reported that the country was still generating about 4,300MW of electricity. Significant energy is still lost to weak transmission lines coupled with incidence of system collapse which is still prevalent.

Some believe that if the privatisation timetable was followed to the letter, we would have been singing a new song as new owners of the generation, transmission and distribution companies would have commenced operation in earnest leading to a break through in the sector, and this reform for some Nigerians is tied to the old order.

Therefore, their hope dwindled with the Minister of Petroleum, Mrs Diezani Alison Madueke represented by Mr Austin Olorunshola, a director in the Department of Petroleum Resources (DPR) at the same occasion corroborated this view as she said Nigeria was coming under extreme competitive pressure from African neighbour.

According to her, the oil and gas, discovery in neigbouring African countries and shale gas discovery globally  was a major challenge to the nation’s oil and gas industry.

She also disclosed that the lack of discovery of oil in commercial quantity in the Chad basin was a cause of concern for the sector but allayed the fears saying “the lack of activity in the Chad basin is not a signal of lack of prospect.

The low level of production was also attributed to security challenges experienced in some parts of the country and pipeline vandalism.

President Goodluck Jonathan in his Christmas Message urged Nigerians to continue to trust in his unwavering commitment to fully achieve the objectives of his administration’s agenda for National Transformation for the benefit of all Nigerians. It is hoped that as we enter 2013, the president will have the political will and determination to deliver positive changes as he has promised and make the new year much better in all ramification, especially in the energy sector.