The federal government says it will propose 18 months extension to the national assembly for the implementation of the Petroleum Industry Act (PIA).
Accordingly, this will allow the federal government to continue to make provisions for costly subsidy payments, gulping N1.4 trillion in 2021.
PIA, which made provision for deregulation of the oil and gas industry, was to kickstart this February.
Timipre Sylva, minister of state, petroleum resources, said this while addressing state house correspondents on Tuesday in Abuja.
According to him, Buhari approved the extension of the implementation period of petrol subsidy following engagements with key stakeholders.
In August 2021, President Muhammadu Buhari had signed the petroleum industry bill into law.
“His Excellency, President Muhammadu Buhari GCFR has, following engagements with stakeholders, agreed to an extension of the statutory period for the implementation of the removal of subsidy on Premium Motor Spirit (PMS), in line with existing laws,” Sylva said.
“The new Petroleum Industry Act (PIA) provides for the unrestricted market pricing for PMS from the effective date. However, the PIA also envisaged the potential for supply disruption with its resultant effect on the economy. Consequently, it provides for a window of six months from the effective date for Government to request the services of NNPC Limited as a supplier of last resort. This is to forestall supply disruptions and guide market readiness preparatory to migration to the deregulated pricing regime.
“With assent by the President on August 16, 2021, the PMS subsidy removal was therefore expected to take place effective February 16, 2022.
“However, following extensive consultations with all key stakeholders within and outside the government, it has been agreed that the implementation period for the removal of the subsidy should be extended.
“This extension will give all the stakeholders time to ensure that the implementation is carried out in a manner that ensures all necessary modalities are in place to cushion the effect of the PMS subsidy removal, in line with prevailing economic realities.
“The President assures that his administration will continue to put in place all necessary measures to protect the livelihoods of all Nigerians, especially the most vulnerable.”
Speaking further, Sylva noted that the executive would apply for some amendments to the law ‘so that we will still be within the law’.
“We will approve an 18-month extension, and then it is up to the national assembly to look at it and then pass the amendment as they see fit,” he added.