The GMD/CEO of Mainland Oil and Gas, Mr. Chris Igwe was interviewed by a Daily Trust Reporter reporter and published on their website today. I thought the interview was quite interesting particularly when he talked about why investing $5billion in a refinery is not such an “emotional” thing. “It is not something that you wake up today and decide to build refinery tomorrow. A lot of things are involved”.
However, what caught my attention the most as it did the interviewer was his request for a special intervention fund for the industry. Here him;
How do you source funding to drive all the plans you outlined?
We source our funds locally and it is quite challenging. And this is the area I appeal to the media to drum hard on. The Central Bank governor should come to our aid because our interest rate in Nigeria is about the highest in the world.
In US, interest rate is about four percent. How do we compete with foreign companies that get funding at four percent interest rate while we in Nigeria get funds at over 20 percent? That is a major challenge.
So, I want to use this opportunity to appeal to the Central Bank governor to set up a special intervention fund for the downstream oil and gas industry. This has become important to bail out some operators who have made the mistake of taking short term loans for long term investments.
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