States now sharing N2.1tn as subsidy savings boost allocations — Lokpobiri

The Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, has said the three tiers of government are now sharing about N2.1tn through the Federation Account Allocation Committee, attributing the increased allocations to savings from the removal of petrol subsidy.

Lokpobiri made the claim while speaking on Politics Today, where he defended the Federal Government’s decision to remove petrol subsidy and deregulate the downstream oil sector.

According to the minister, the savings from subsidy removal had increased the funds available to states and enabled them to embark on major projects.

“These days we get 2.1 trillion being shared. This is the first time it is happening,” Lokpobiri said.

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He recalled that before the current administration, several states struggled to meet their salary obligations.

“You’ll recall that before this government came, about 27 states had no capacity to pay even salaries. Today, states are doing gigantic projects. It’s because of the savings that we made from this subsidy,” he said.

Lokpobiri also defended the deregulation of the petroleum sector, arguing that the policy had created room for private investment and enabled businesses such as the Dangote Refinery to operate.

He said the presence of a major refinery in Nigeria did not automatically mean petrol prices would be lower, noting that crude oil and petroleum products are traded in a global market.

The minister said deregulation was designed to encourage private-sector participation across the midstream and downstream sectors.

“Deregulation all over the world is to enable private sector businesses to thrive and all the businesses that are associated with the oil and gas sector,” he said.

Lokpobiri further maintained that the government would not reverse the deregulation policy despite concerns over the impact of petrol prices on consumers.

He said the policy was necessary to attract investment and expand activities in Nigeria’s oil and gas industry.