Nigerian Refineries in Focus: Govt. approves $2.9bn in two Months for 3 Refineries overhaul

0

CEM REPORT | The Federal Executive Council has again approved contracts for the rehabilitation of Warri and Kaduna refineries at a cost of $1.4 billion barely two months after the sum of $1.5bn was approved to fund Port-Harcourt Refinery repair.

Minister of State for Petroleum, Timipre Sylva, told State House correspondents after the Federal Executive Council meeting chaired by Vice President Yemi Osinbajo on Wednesday.

Channels reported that Warri refinery repair will gulp $897 million while the other $586 million is for Kaduna refinery.

According to Mr Sylva, the rehabilitation of the Warri and Kaduna refineries will be carried out in three phases. First phase is within 21 months; in 23 months, phase 2 will be completed and in 33 months, the full rehabilitation will be completed.

In March, the Nigerian Government approved $1.5bn in funding to repair the Port Harcourt refinery, which was closed two years ago. The repair was also to follow 3 phases.

The first phase of the refinery overhaul project was scheduled to complete in 18 months; roughly by September 2022. Government aims to bring the refinery’s production to 90% of its total production capacity.

On this, Mr Sylva said after the Wednesday FEC meeting that, work has already commenced in the Port Harcourt; already the first 15 per cent of the contract sum has been paid to the contractor and contractor has fully mobilized to site.

Still from the Wednesday FEC meeting, Government also approved the sum of $2.76 billion for acquisition of 20 percent minority stake by the NNPC in Dangote Petroleum and Petrochemical Refinery.

The three refineries to be overhauled have a combine capacity of 445000 barrel per day. Port Harcourt refining has a capacity of about 210,000bpd, while Warri and Kaduna refineries have 125,000bpd and 110,000bpd capacities respectively.

The Africa’s biggest oil producer has spent billions of dollars importing refined products. Between January and March 2021 alone, the import of petrol into Nigeria amounted to 688 trillion Naira. N2.17 trillion was spent in the first nine months of 2020 on the same importation of petroleum products.

Nobody will not be excited by this recent focus on the repairs of the nation’s refineries having been unjustifiably neglected for over two decades.

In spite of the pronouncements, skepticism still in the mind of Nigerians who have heard of similar pronouncements and promises over the years without any result

NNPC had made attempts to overhaul the nation’s refining industry in 2007, 2010, 2012 and 2016 and all failed to work out. The nation will saved itself from import dependence if this didn’t go the same way other repair attempt went.

We do hope that Minister of State for Petroleum Resources Timipre Sylva’s assurance in an interview in London this month is something to hold on to.

He had assured that the current overhaul efforts should be successful this time because Nigeria is asking the owners of the refinery technology to get more involved in the work.

0 0 votes
Article Rating
Subscribe
Notify of
guest
0 Comments
Inline Feedbacks
View all comments