"WR6_gUnUj-ztiW07KQcOCnTel9A"/> Notes From Atlanta: Biggest Scandal in Oil “Subsidy Removal” Fraud

Saturday, November 5, 2011

Biggest Scandal in Oil “Subsidy Removal” Fraud

By Farooq A. Kperogi, Ph.D.
Twitter:@farooqkperogi
 
To begin with, the idea that the Nigerian government is subsidizing fuel for the masses is a willfully double-tongued twaddle. Only four kinds of people believe that: the hopelessly ignorant, the mentally subnormal, masochists with a perverse thirst for self-abasement, and beneficiaries of real government subsidies such as our indolent, unproductive, and ruthlessly acquisitive government officials and their equally debauched cronies in the private sector. Many informed commentators have conclusively proved that.

But there is an even more treacherous scandal in this “oil subsidy” scam that the Nigerian national media is either not aware of or has chosen to ignore.

Two weeks ago, when I compared fuel prices among oil-producing nations of the world and showed that Nigerians pay the highest price for petrol even though they receive the lowest minimum wage among their peers, I actually did a gross disservice to my argument. The situation is a lot worse than that. I will come back to this point shortly.

 I pointed out that the petrol I use for my car in America burns A LOT SLOWER than the one I use when I visit Nigeria, meaning that, at the current rate, Nigerians (with a miserable minimum wage of N7,000 per month or about $45 per month— against America’s over N180,000 minimum wage per month) actually pay more than or about equal to Americans for petrol. It takes a remarkably heartless person to ignore this heartrending fact. But that’s an issue for another day.

A Nigerian online citizen investigator who goes by the handle “Viscount” revealed on a Nigerian Internet discussion forum recently that Nigerians not only pay the highest price for fuel in OPEC; they also consume the worst imaginable grade of petrol among oil-producing countries. That means comparing fuel prices between Nigeria and other oil-producing countries—or even countries in Europe and North America— is actually like comparing apples and oranges. 

These countries not only pay considerably lower prices than us for high-quality petrol, Nigerians have been paying unconscionably high prices for toxic fuel for the past 12 years, as you will see shortly. And they will pay even more for it next year. If this is not sufficient reason to give up everything and “occupy” Nigeria until the oppressors are brought to a standstill, I don’t know what is.

At the center of the tragic importation of toxic petroleum products into Nigeria—and other West African nations— is an Amsterdam-based multinational company called Trafigura. Keep that name in mind as you read this.

Many Nigerians know that the fuel they consume domestically isn’t derived from the crude oil their country exports. They also know that they have one of the world’s best and finest quality of crude oil. What many of them don’t know is that the cabal of rapacious oil importers that the Jonathan administration—and the administrations that preceded him—mollycoddle with “subsidies” actually import toxic, low-quality oil that is not fit for consumption in Europe or North America—or in any society that cares for the welfare of its citizens. 

In 2010, a group of journalists from the UK, Norway, and the Netherlands won a prestigious international journalism award for a series of investigative reports they did on Trafigura’s barbarous dumping of toxic petroleum waste on Cote d’Ivoire. The waste killed scores of people and sickened thousands more. In July 2010, an Amsterdam court found the company guilty and fined it 1 million euros. (The caustic petroleum residues were dumped on Cote d’Ivoire on July 2, 2006). 

On June 24 this year, Afrol News, an Africa-centered news agency, reported that it had been “given documentation” that shows that the same Trafigura that was fined for dumping deleterious waste on Ivoirians had offloaded “dangerous and poor gasoline [i.e., petrol]” in the “Nigerian port of Lagos.” This toxic petrol, which Nigerians have been consuming for years and which our governments “subsidize,” according to the Afrol News report, “is highly unstable, not enduring sunlight exposure, and will cause damage to vehicles. It will also cause environmental damages due to high sulphur values, and can therefore cause human health damages. The product is strictly illegal in Europe and the US, but may in some cases be within legal quality and environment standards in some West African countries.”
But this wasn't a one-off occurrence. It's been happening for over a decade. So, ordinary Nigerians are being forced to use their hard-earned money to buy inordinately overpriced and demonstrably harmful petroleum products. Yet the Nigerian government says this isn’t bad enough; it wants to increase fuel prices again next year. And the government has no plans to repair our refineries so that we can refine our own crude domestically and bring down the cost of petrol. 

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But the bigger scandal is that in January this year, the Jonathan administration signed a multi-billion-dollar annual contract with the same Trafigura of toxic fuel dumping infamy. And there was no due process in the award of the contract. According to Business Day of January 4, 2011, “Under the agreement with the Nigerian government, Trafigura is expected to pick up Nigerian crude oil and in return, supply her with refined products; but it is unclear why the firm, which has supplied refined products to Nigeria in the last 12 years, was favoured for the deal.

“Trafigura agreed to an annual contract with the Nigerian National Petroleum Corporation (NNPC) on the basis of taking 60,000 barrels of crude oil per day in exchange for refined products such as gasoline and gas oil of equivalent value estimated at around $3 billion a year.”

An oil industry expert who spoke to Business Day said just “$1 billion of the amount would have put the four refineries in proper shape.” When I wrote two weeks ago that Nigerians were faced with a choice between death and life, I didn’t even know about all these.

I am going to leave the reader with “Viscount”’s parting thoughts:

“Nigeria will give Trafigura (confirmed supplier of bad petrol), 60, 000 barrels of oil per day in exchange for their mega tonnes of DEADLY-sulphurous petrol! Yep, Jonathan's government is paying a foreign company to systematically KILL Nigerians. And poor Nigerians are being asked to be happy jare!

“So, Nigerians, when your brand new Tokunbo engine knocks - just like that, thank Trafigura! When your I-better-pass-my-neighbour generator's fume smells funny and leaves a film like Casper the Ghost - just like that, thank Trafigura! When you are walking in Lagos, or any other Nigerian [city], and you are experiencing a choking sensation from the mundane act of breathing in - just like that, thank Trafigura! Nigeria!”

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34 comments:

Zainab said...

And the gong still went off! The king has spoken. His subjects MUST buy their ways to the graves at the price of N150 per litre.

Zainab Magaji

ZUBAIRU ZAINAB said...

Thank you Mr Ahmed for bringing this devilish act to the open,I hope Nigerians will stand up and fight for their rights.To the NIGERIAN GOVERNMENT; What goes around comes around.

Shehu said...

there is every reason to react sir.

Anonymous said...

Dr Farooq, thanks for this enlightening eye-opener piece. Since we have leaders who dumped themselves on us and who are themselves poisoned petrol,it becomes easy for foreign firms to dump poisoned petrol on us.And now at a higher unsubsidised price-if we allow them and their local corporate(sorry,political)collaborators.
Tajudeen Sanni

Unknown said...

God where are you? When will this end? Okonjo Iweala & others we prayed to come abroad....have u turned Judas?

Anonymous said...

Whao! It's only God that can save our people from this cabal.

Anonymous said...

Prof. We thank Allah for having people like you, who investigate and point it as it is. But in Nigeria, the Government and the Governors have insisted that their imagined subsidies must be removed.
Meanwhile the Nigerian Labour Congress NLC and the TUC have promised to resist the move to remove "subsidy".

The average Nigerian is already lost and does not know the way forward. The only solution to this massive rape on the Nigerian masses is credible election in which the peoples vote truly counts.

zaianb sule yaro said...

what is happening to NNPC and the nigeria government,abi dem don swear 4 us ne?something has to be done

Hauwa said...

Hmn! A BREATH OF FRESH AIR!
We are in deep shit.

Anonymous said...

as well informed citizens how do we deal with this? Talking about it will only wont get us too far

Anonymous said...

great mess in my country...this is really educating..

Anonymous said...

Let me use this medium to ask Mr President whether this poisonous imported petrol and removal of subsidy is the fresh air he has being promising Nigerian during his campaign ???????

Anonymous said...

Great to have this revealed. Next thing is 'what do we do'? We are a people not familiar with violence such as experienced among some arab nations. Something needs to be done. Its unfortunate that our media do not carry out investigative journalism and bring this out to the public. They've all been bought.

Anonymous said...

nigerians, vote PDP again 2015 ok, and maybe then, you will have PDP's finest strawberry flavored nuclear wastes dumped in your backyards. PDP !!!!!!!

cletus amadi said...

well said mr anonymous, PDP at their best. well, nigerians you have got a choice, either kick them to their graves in 2015, or u get kicked into yours

Awwal Bashir said...

This piece is soul-touching, a clear signal of what is to come from the Mighty PDP, Nigerians 2 decide positively or otherwise; God help us

MR. "FRESH AIR" said...

Yes! Nigerians are reaping the physical work of n2n, women in politics, so-called PDP stalwarts etc but technically, the hypocritical maneuvering & betrayal of 180bln citizens trust by INEC for unjust instituting of unlawful & unconstitutional government.

Anonymous said...

TALK TALK TALK NO 1 REPEAT NO 1 WILL DARE HIMSELF THATS THE BAD NEWS. SOWEE NAIJA. TIME ALWAYS TELL.

Anonymous said...

What I don't really understand is, Have they (the ingrate leaders) forgotten that they have children, relatives and friends that will woah to their act of ignorance? Or do they think that this will last forever. Mtcheww, shame on them Bad leaders.

Anonymous said...

Why is it that these kind of informations dont appear in our local newspapers for everyone to be informed?

Chikata said...

The truth is that we get to hear a whole lot of these but the question is who ACTS.......we have a big problem in all sectors. Solution is farfetched, unless one is ready to take the bull by the horns and not get deceived by the milk that is not even from the bull.

Anonymous said...

Professor, It is interesting to read of your achivements over the years and I also noted that you were a speech writer for the PRESIDENCY in Nigeria. Would you be kind enough to let me have a copy of some of the speeches you wrote for Mr President in the years past. That would give me a good view of the personality behind the current write up, which no doubt is very important, topical and worthy of calling for action. I have seen some people who benefited from the plundering of the Nigeria State become Saints when they are unceremoniously booted out of power/position or when their services are no longer required. I will like to establish that you are not one of them.
Thank you

Phili said...

I will never forget the word 'Trafigura',what a nice piece prof.keep it up.

Anonymous said...

am sure Nigeria wil survive dis administration. One thin dt dis administration fail to undstand is dt Nigerians ar stern Lover of God who believ dt God wil subsidiz 4dem no matter wot

Shittu Fowora said...

This nation is being undermined on all front, i am just wondering what divine string has kept us together this far. But sure ignorance is a factor, how i wish i could translate this into forty Nigerian languages and mass produce it for continuous public sensitization for 4 months lets see if REVOLUTION will not sound!

Anonymous said...

Your arguments are myopic and baseless. Crude Oil is traded on an intl market @ 100usd/bbl. This translates mathematically to 132naira per Liter of petrol. This has no Nigerian factor embedded. Pls, can you let us know your Grade in maths in high school. As per the bad fuel importation, deregulation will solve that. If Mobil sells bad fuel then u go to Oando. Pls, lets use our brains to argue NOT emotions. Subsidy Removal is the beginning of wisdom

Remi said...

Thanks for your eye opener but one thing my co-commentators failed to ask is that you only tried to bastardies the FG plan without any suggestion on way forward. I found it difficult to believe as you said that only this mentioned company supply us our refined products what of other licensed importers? Are you saying we dont have standard?. I also will not agree with you that our leaders will intentionally import a toxic product for us to consume, are they and their immediate family buying from a special petrol stations? Are you saying the coke you buy in Nigeria is the same with the one in US and UK.Do you consider climate different in consumption of fuel?Are you aware that the imported electric cable uses in US and UK can not be used in Nigeria due to some factors? If your view is to be considered critically, it is in support of total deregulation. By this refineries will begin to spring up in the country and the people will have choices of fuel to purchase instead of total dependent on importation.This present Government has been trusted in the immediate past without failure let give them the chance to manage the economy before its crumbled.

Anonymous said...

Dr. Kperogi, the wicked Jonathan government has unleashed its attack dogs on you for exposing them. The last two comments are proof positive of this. Expect more such stupid, baseless, illogical attacks. But we are behind you solidly. No shaking!!

Anonymous said...

@Remi, you must be an agent of government. The comment before Remi's is not even worthy of a response. It is so idiotic beyond belief!

This author has shown conclusively that Trafigura was fined millions of Euros by a European court for dumping toxic fuel on Ivory Coast. He has also shown through links from impartial sources that Trafigura dumped and dumps low-grade fuel on Nigeria. And he has shown beyond doubt that Jonathan signed a contract worth billions of dollars with the same deadly Trafigura. And you are still saying what? You these Jonathan defenders are just as dumb as the man himself. Mshewwww!!!

John Chukwu, Port Harcourt, Nigeria

Anonymous said...

@ Remi & co..why aren't our refineries working optimally? Why isn't the Nigerian crude refined and the refined product returned to our shores for local consumption (are we even supposed to be discussing that)? I wonder if people who stand up to defend Duns realize they end up sounding like one.

Anonymous said...

Dummies like Remi and the idiot before...should think in the behalf of their likes(the masses) and not for the wolves in the government. It would have been nice to have stated the acts the present government has done so far that has benefited the masses... Because you don't feel the impact of the sufferings of the masses does not mean there are people out there who don't. Some still trek to their work places, only to earn a paltry sum to give back to the government. When will d likes of these idiots realise that the government past and present have gradually been feeding on the flesh of their people and drinking their blood. Like was asked what happened to the refineries? Why are we still importing fuel? In countries where you think fuel prices are high the common man does not have his everyday activity dependent on fuel. There's power everyday even in companies. He probably only needs fuel for his car. But here in naija with d power sector completely dead. You have to generate power yourself. Remi is stupid and has no iota of feeling for what everyday people go through. Selfish bastard.what you probably don't know is that the cries of sufferings of the masses in d hands of heartless leaders reach God and the payback one way or the other goes to relatives of Jonathan like Remi.

Omar said...

Thanks Farooq for this revealing article on the scandal in the Oil industry in Nigeria.If this were to happen in other climes, by now the citizenry would have embarked upon mass action to demand for justice against Trafigura and its local allies.Alas! Nigerians are too docile,sharply divided along ethnic, religious and tribal lines. Hence cannot and will not act in unison to demand for their collective rights-be it good governance, descent wages, security of lives & property, etc. It is a shame, many claim to be educated, but when they react to issues, they are mere 'educated illeterates'. (See some comments posted insulting you!). May God save us from our foolishness and stupidity!

BANSO said...

⌣»̶·̵̭̌·̵̭̌✽̤̈̊Ŧђɑ̤̥̈̊п̥̥̲̣̣̣kƨ̣̣̣̇̇̇̇✽̤̈̊·̵̭̌·̵̭̌«̶⌣ Fø̲̣̣я̅ this revelation

abubakar bichi said...

Thanks alot Prof. This message shade more light on the 'fuel subsidy' saga going on in our great country, Nigeria. The masses should decide on the future of our fatherland. The era of divide and rule tactics along ethno-religious and regional differences by our leaders is over. Nigerians are united and all we are saying is NO to CORRUPTION; CHANGE WE NEED!