FG dumps Dangote’s proposal to sell crown jewels

Federal Government yesterday dumped Alhaji Aliko Dangote’s proposal to sell Nigeria’s Liquefied Natural Gas (LNG) and other crown jewels to augment shortfall in revenue, insisting that borrowing would be a better option.

Acting Chairman of Revenue Mobilisation Allocation and Fiscal Commission (RMAFC), Shetima Umar Abba Gana,  who faulted Dangote’s proposal, said that Nigeria’s gas reserves which totals 188 trillion cubic feet, is the best in the world because of its low hydrogen sulphide impurity levels.

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Instead of selling Nigeria’s assets, which generate funds to the Federation Account, wealthy Nigerians should be encouraged to set up their own LNG projects.

In a statement, Gana    argued  that it would be unwise for the Federal Government to dispose of its revenue generating crown jewels that keep the Federation Account robust over the long term.

Dangote had earlier advised the Federal Government in an interview with  CNBC Africa to sell off the federal assets as a way of augmenting the current revenue shortfall to wade over the current economic recession.

Citing   the NEITI 2013 audit and financial report of Nigeria’s oil and gas industry, Gana  disclosed that the sum of $12.9 billion was received by Nigerian National Petroleum Corporation (NNPC) from the Nigeria Liquefied Natural Gas (NLNG) company over an eight-year period which the corporation did not remit to the Federation Account.

The audit,  according to RMAFC  also revealed that Nigerian Liquefied Natural Gas (NLNG) company paid the sum of $1.289 billion as dividends for 2013.

“It is the considered view of the Commission that Nigeria’s assets like NLNG and other strategic national resources should not be sold to meet short-term financial obligation” he said.

RMAFC Chairman recalled that the Governor of the Central Bank of Nigeria (CBN), Mr. Godwin Amefiele,   indicated in a media report that the sum of $10 billion would be realised from the sale of these assets.

The Commission, he explained,  is of the strong opinion that the same amount could be borrowed from the IMF and the revenue from these assets could be used to amortise the loans over an agreed period.

“It should be noted that after the amortisation of the loans, those assets would still be owned by the Federation in addition to their regular dividends and revenue” he said.

The Commission advised that instead of selling off such vital assets which generate funds for the federation, wealthy Nigerians should be encouraged to set up their own LNG projects, since Nigeria ranked  seventh in the world and first in Africa with natural gas reserves base totalling 188 trillion cubic feet (Tcf) as at May 1, 2015. In addition, he said,  Nigeria’s natural gas is regarded as one of the best in the world as it has low hydrogen sulphide (H2S) or carbon dioxide (CO2) impurity levels.