The Nation Newspaper

Tag: refineries

  • Why private refineries are yet to begin operation

    Finance is one of the major reasons why the 18 refineries licensed in 2002 are yet to take off ,The Nation has learnt. Financial institutions do not want to provide long-term funding for operators in the oil and gas industry. There is a rigid mode of repayment of loans, besides.

    Industry observers said the failure of the refineries to come on stream, 14 years after, has further worsened the fuel situation in Nigeria. The Chief Executive Officer, Jehata Nigeria Limited (owners of Abuja Power Station), Mr. Jameel Jammah, said technical deficiencies and huge capital are some of the problems facing owners of private and public refineries globally.

    He said owners of private refineries are worse hit, because they do not have the money required to set up refineries. Jameel said dearth of skills and capital are some of the problems besetting the growth of private refineries.

    He said: “This explains why it is difficult for the 18 privately-owned refineries licensed by the Federal Government to take  off, 14 years after they were approved. Accessibility to credit facility is poor in Nigeria, coupled with lack of required manpower. When banks refuse to lend to firms that won the bids for the establishment, there is nothing they could do.

    “The demands from the banks, which want to fund the projects, are outrageous. For instance, in a situation whereby banks requested that people should repay the loans within five years, as against a period of say 10 to 15 years, there is a problem. Where did the banks want people to get the money to pay back the loans, which they were given to finance the building of the refineries within such a short period?’’.

    According to him, refineries’ operation is in stages, noting that both the existing and prospective owners of refineries globally pass though the stages. Jammel listed the stages to include getting and clearing the site for the project, carrying out an Environmental Impact Assessment (EIA) programme on the project, knowing the  capacity or output of the refineries, profit projection, let say in the next five years,  and others

    “I  can frankly tell you that many banks refused to lend money to us, when we conceived and started the building of our modular refinery in Abuja. The problem is the same all over the world. Nobody is ready to commit funds to a project that one is not sure of its immediate returns,’’he said.

    Also, the former President, International Association of Energy Economists (AIEE), Prof Adeola Akinnisiju, said a lot of things come into play when the issue of owning a refinery (whether traditional or modular) crops up.

  • FG should hands off refineries – Olafemi

    FG should hands off refineries – Olafemi

    A former Acting Governor of Kogi State and member of the Board of Trustees (BoT) of the All Progressives Congress (APC), Chief Clarence Olafemi, has called on the Federal Government to liberalize crude oil refining licence.

    This he said will encourage more private participation in crude oil refining in Nigeria.

    Olafemi in a position paper issued Monday in Lokoja, a copy of which was made available to The Nation, called on the government to hands off refineries, if it was intent on eliminating corruption in the sector.

    Speaking further on the controversy arising from last Wednesday’s announcement of the N145 per litre price ceiling announced by government, up from the previous N86.50 per litre official price, he called on the authorities to find a balance between reining in the excesses of the private players in the industry and complete deregulation.

    According to him: “The best option is to create massive private participation in local refining of crude oil by liberalising licensing.

    “The government has no business running a refinery; otherwise we will only be transferring corruption from importation to maintenance/running cost. For example if the government is directly involved in cement manufacturing, we would not by now be where we are as a nation in being self sufficient in the product and conserving the huge foreign currency for importation of finished cement products.

    “Nigeria should quickly and hurriedly remove all obstacles on guidelines for owing a private plant and guaranteeing regular sales of crude to them at international market rate, and you will have a stable and competitive situation in the selling price. Mr. President can safe Nigeria from this recurring perennial problem by focusing in this direction.

    “I want to believe some serious impediments still exist that is not attracting both local and international investors from jumping at the offer. Let us remove those impediments immediately and millions of jobs will be created in addition to disposing with this problem of product scarcity and noise about pricing.

    He called on the government not to abandon the sector to the vagaries of market forces, asserting that doing so will be to the detriment of the common man.

    He added, “There are factors that represent deregulation, which the businessmen will still form a clique to exploit the ordinary people. This is the reason why the government still needs to intervene in establishing those input and telling the importers to find appropriate source to march the government established parameters. If you therefore want to use English to describe in absolute term what is happening then use regulated deregulation.”

  • ‘Nigerian refineries younger than those in US, Europe’

    ‘Nigerian refineries younger than those in US, Europe’

    To confirm that the nation’s refineries have suffered severe lack of maintenance over the years, the National Engineering and Technical Company (NETCO), an arm of the Nigerian National Petroleum Corporation (NNPC), has said the refineries are younger than many in Europe and the United States, which are working efficiently.

    NETCO, which participated in the independent assessment of the refineries, pipelines and depots with AF Consult Group of Sweden and Switzerland, found that most refineries, abroad are older than Nigeria’s.

    The independent assessment was funded by the Facility for Oil Sector Transparency and Reform (FOSTER).

    FOSTER is an organisation funded by the United Kingdom Department for Foreign Development which engaged the AF Consult Group of Sweden and Switzerland, that  conducted the test.

    It said: “The findings showed that  the refineries are younger than the average refineries in Europe and the United States, some of which are world leaders today. The ongoing phased turnaround maintenance (TAM) in the refineries is hindered by financial constraints and inefficient approval processes.

    “In 2011, NNPC designed a new business model that its focus was to reposition its business units and increase profitability. In this model, all NNPC strategic business units will run as major profit centres. This model is yet to be fully implemented. A viable commercial model with good cost control mechanisms, secure crude supply, and unhindered product evacuation is key to attracting investors to this sector.”

    The independent assessment project team, which consisted of AF Consult, FOSTER, representatives from NNPC group managing director’s office, refineries, technical services directorate and NETCO, noted that rehabilitating the refineries will save about two-third of the cost of building new ones. Streamlining the organisational structure and simplifying its processes will result in higher effectiveness and efficiency that would foster growth, they added.

    The team said: “With the high gross refining margins reported by the refineries, there is a great opportunity for investment in the downstream sector. However, in spite of the huge opportunities, pipeline vandalism still poses a major threat to its survival. Unless the planned rehabilitation of the refineries is carried out, the plants will still remain unreliable, unsafe, and unprofitable.

    “The implementation of the new business model with a solid and transparent governance structure, assets transfer, and available working capital is fundamental to the expected transformation. Concerted efforts involving relevant government and security agencies including military and paramilitary are required to curb pipeline vandalism, which continues to pose a huge national threat. The host communities being major stakeholders should also be directly involved.

    “The fuels are profitable and critical for national stability, prioritization of the TAM is required and the efforts should be centred on the fuels plants to get them running profitably before the rehabilitation of the non-fuels plants at the refineries”.

    “Fast track approvals, funding, and procurement should be secured to enable the successful completion of the phased and future TAM within schedule and budget. With low crude oil price resulting in higher margins in Nigeria, more investments will go towards the refining sector to create huge job opportunities.”

  • Nigeria to begin exportation of fuel by 2019 – Kachikwu 

    Nigeria to begin exportation of fuel by 2019 – Kachikwu 

    Minister of State for Petroleum, Dr. Ibe Kachikwu has said that, the federal government in its efforts to permanently end fuel crisis in the country is to build three more refineries in Kaduna, Port-harcout and Warri.

    He said when that is completed as planned by 2018, Nigeria will start exporting refined petroleum products for the first time since inception by 2019.

    This was also as he promised that, every household in the country will get free gas cylinder before the end of next year, to stop over dependence on kerosene.

    The Minister who doubles as the Group Managing Director of Nigerian National Petroleum Corporation (NNPC) stated these while addressing Nigerians at the Town Hall Meeting organised by the Federal Ministry of Information in Kaduna on Tuesday.

    According to Kachikwu, “More refineries have to be built, and the target is to build three more refineries to be located in Kaduna, Potharcout and Warri taking advantage on the share facilities.

    “And if we do this, by 2018 if all our refineries are working we will drop importation by 60 percent. And by 2019 if the four located refineries begin to work and am sure they will, we will actually begin to export petroleum product for the first time in this country.

    “Let me start by apologising for the difficulties you been experiencing in terms of getting fuel.

    “Having arrived Kaduna this morning from Lagos, I did a quick tour of Kaduna metropolis. Although the situation is improving but I felt sad still that some areas around the metropolis are not getting the product especially that you have a refinery.

    “But the realities about the situation is that wherever I turn when I was appointed I found problems when.

    “The refineries were not working when I was appointed in October. If I turn to the pipelines, they were not in existence. If I turn to the upstream, there no funding. So production was sliding.

    “If I turn to the NNPC structure, there was massive issue of transparency that everybody talked about. And if I turn to what the future was to Nigeria, I saw the solution rather than hope.

    “So, I took over the mantle under these circumstances. But I was not discouraged because the President is committed to surmounting the problems.

    “This is the first time we have two refineries working simultaneously in the last Eight years. For the first time in 20 years we are working to restructure the NNPC.

    “On the fuel issue, the reality is that as long as these refineries don’t work in absolutely top capacity, as long as we don’t have the foreign exchange to bring in the products, as long as the price of crude continues to slide, and part of my responsibility is getting it up.

    “As long as such conditions continue, we will have problems with fuel. So we have to apply brain work to it.

    “Do, I want to see the problems continue? No. There is a lot of improvement but there is a lot of work require. And in the next three months I assure you will see great improvement in terms of fuel supply.

    “Most importantly, we need to begin to developed massive infrastructural support in this country. The pipelines must get to work, got to get investors to invest in them because we do not have the money to build them up.

    “For the upstream sector where production has been climbing down, our target is to move production up to 2.3 Million barrel, but I am personally committed to 2.5 million barrel.

    “The blowing of pipelines cannot drive us back, we are committed. The days of hopelessness have passed, the days of careless expenditure are passed, the days of corruption are going, and we are heading to the future were we can deliver a country we can all be proud of,” he explained.

    He however promised that, “to improve our marketing outlets, we are building about 700 marketing outlets all over the country, one per local government. And we are asking the state governments to give us land to do this.  We are building multi big stations with shopping malls, which will beef up activities in the local government areas.

    “We have the concept of providing free gas cylinders to every Nigerian household, which will be roll out next year so that we can pull Nigerians away from the use of Kerosene to cleaner fuel,” he promised.

    However, before rounding off his address,  Kachikwu asked everybody in the hall to stand up, holding hands together and recite the following: “we are Nigerians, we are made by our common destiny, our purpose, our country is bless in ways unimaginable, we as Nigerians are not limited by hope, not limited by resources, not limited by talent, not limited by aspirations. Our nation has had its challenges but we remain abundantly bless, so today, this moment, now going forward, we join hands across our land, hands across our tribes, hands across our religion, hands to our leaders and our followers. And as Nigerians unite in struggle, we have decided to build  the Nigeria of our dreams, a Nigeria of less criticism but creativity, a Nigeria of abundant not scarcity, a Nigeria unify not fraction, a Nigeria transparent not fraudulent, a Nigeria with abundant dreams, aspirations and delivery. Today, this moment, we stand on treasure of history to built the new Nigeria of our dreams.”

     

  • Ijaw youths seek legalisation of ‘bush’ refineries

    Ijaw youths seek legalisation of ‘bush’ refineries

    IJaw youths want ‘bush’ refineries legalised. The youths represented by the President of the Ijaw Youths Council (IYC) Worldwide, Mr. Udengs Eradiri, spoke at the Glasgow Caledonia University on the invitation of the Africa Future Matters (AFM).

    They also desire lasting solutions to the myriads of economic and political issues bedeviling the Niger Delta.

    Eradiri used the Glasgow opportunity, to tell the world the major headaches of the Niger Delta, a region that almost single-handedly finances the Nigerian economy. In fact, Eradiri stood tall among intellectual experts and reputable scholars who listened to him as he delivered the keynote address that touched all aspects of the Niger Delta issues.

    Among other issues, his address dwelt more on the environmental degradation of the region arising from activities of persons who try to crudely refine crude oil for commercial motives.

    He told the world that criminalizing ownership of what he described as bush or local refineries was counterproductive. To harness the benefits of ingenuity, intellectual capacity and skill associated with the establishment and ownership of such ventures, Eradiri asked Nigeria to decriminalize bush refineries.

    He said the Federal Government’s approach of treating persons linked to such refineries as criminals has exacerbated the problems posed by bush refineries such as ecological degradation, loss of revenue, incessant vandalism of oil infrastructure, health hazards and emergence of armed gangs.

    “Government must decriminalize the act of crude refining techniques and local oil refining. This will help to increase the current abysmal refining capacity in the country and permanently solve the problems of scarcity of refined crude oil products currently wrecking havoc in the country’s economy.

    “Besides, decriminalizing the practice will help to create jobs for the youths and finally put paid to the problems of restiveness and militancy in the region. It will also stop all forms of vandalism thereby increasing the revenue of the government”, he argued.

    To decriminalize the practice, he said the government must establish a legal framework to regulate the operations of bush refineries. He said the regulation must include the framework for sourcing crude, quality control and ecological maintenance.

    He said: “Government should set up local refiners into cooperatives in order to control their activities. By so doing, the government will be in control of the registered community cooperatives which must ensure that their activities are within the regulated practice”.

    Eradiri argued that currently most of the refined petroleum products sold in filling stations across the country are sourced from bush refineries. He said such products even find their ways to the Aso Rock Villa and are unknowingly used by the Presidency.

    “I challenge the Presidency to carry out a forensic examination of refined petroleum products used in the Aso Rock Villa to ascertain my claims. There is no gainsaying that bush refiners have always come to our rescue especially in time of scarcity and if we legalize the practice it will not just create jobs, it will bring down the prices of petroleum products in the country”, he said.

    He added: “The government should study the ingenuity of local technology involved in the process of bush refineries and improve upon it. This will help in our drive to use local technologies in solving our problems.

    “We insist that legalizing bush refineries will safeguard the environment, increase revenue to government, create jobs, reduce crime and motivate communities to take ownership of oil infrastructure and protect it from vandalism”.

    Besides local refineries, another issue that stole the attention of the Ijaw Leader is the clean-up of environment negatively impacted by oil exploration and exploitation. Eradiri welcomed the move by the President Muhammadu Buhari-led administration to clean Ogoniland.

    But he said: “Ogoni clean-up must be done by a globally known companies in accordance with international standard. It should act as a catalyst to the entire Niger Delta clean-up because cleaning Ogoni without cleaning other parts of the Niger Delta would be an exercise in futility.

    “We insist that the cleaning must not be politicized. We have it on good authority that many unknown companies are lobbying to get the contracts for political considerations. Government should not allow such persons to derail its genuine intentions to clean-up the Niger Delta region”.

    Eradiri further drew global attention on some policies and strategies that had stifled the development of the region. He said the marginalisation and exclusion of the people from the ownership of assets and lack of access to social amenities defined poverty in the region.

    He said: “It is only if and when development strategies address these factors holistically that the possibility of alleviating poverty and reducing vulnerability exists. There should be a people-centred development agenda founded in the region’s natural and human capital.

    “Nigeria needs to change the distribution of revenue in order to reverse poverty in the Niger Delta, a region that has seen few gains from the nation’s 50 years of oil production.

    “The people of the oil-bearing communities should no longer experience the gross social infrastructural neglect, poverty, ecological catastrophes and other deprivations they face deity their contributions to the development of Nigeria”.

  • FOREIGNERS WON’T RUN NIGERIA’S REFINERIES, SAYS KACHIKWU

    FOREIGNERS WON’T RUN NIGERIA’S REFINERIES, SAYS KACHIKWU

    •We won’t sell refineries  •Kachikwu apologises again for fuel scarcity, says it’s easing off

    The Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, who is also the Group Managing Director (GMD) of the Nigerian National Petroleum Corporation (NNPC), has stated that foreign investors are not going to run the refineries in the country.

    They are only going to provide funds and technical support, he said.

    He declared that he would never give up in the discharge of his duties, while urging Nigerians to give change the opportunity to work, while assuring that the refineries would not be sold.

    Kachikwu also apologised again to Nigerians on fuel scarcity, saying it had started easing off in Abuja, Lagos and some other cities.

    He confirmed that Port Harcourt and Warri refineries had started refining, while Kaduna refinery had been receiving crude oil and would be back in production (refining), within one week to ten days.

    The petroleum minister stated these yesterday at the Port Harcourt Refining Company Limited (PHRC) in Rivers State, a subsidiary of the NNPC, shortly after re-commissioning of the crude line of the PHRC.

    Kachikwu was received by the Managing Director of PHRC, Dr. Bafred Enjugu, in company with other officials of the company. Enjugu stressed that the refineries (two – old and new – in Port Harcourt, but one currently working and one each in Warri, Delta State and Kaduna) had come up, because crude oil was now available, and gave an assurance that the refineries would no longer come down, unless by circumstances beyond their control.

    The minister of state for petroleum resources hinted that the refineries currently had capacity of 12 million litres of refined petroleum products per day, but could go up to 20 million litres per day, when all the refineries would be working optimally, but he put the national total consumption at 45 million litres of petroleum products per day.

    Kachikwu said: “I have always believed in the capacity of our people to deliver and I have always encouraged them. Port Harcourt and Warri refineries are back in production. Kaduna today is receiving crude and should be back in production, sometimes very soon, within one week to ten days. It is something of joy, because one is taking a lot of attacks on this thing, but these are problems that existed before we came. These are what we set out to correct and we are correcting them one by one.

    “I thank Nigerians for their patience and I urge them to remain resilient and support what we are doing, because it is the only way to change the system. I do not focus on the attacks and all kinds of publications. I focus on the results, which are coming out one by one.

    “We are not inviting foreign partners to take over the refineries. We do not have the funds. Even now that they are working, they are probably working at about 60 per cent or less below capacity. We need to upgrade the refineries and get them to a level where they will be at least 90 per cent performance, which requires money. Total investment for that is in the excess of $700 million and we do not have it. Let us be honest about it.”

    He added, “What we have now done is to find a very creative way of bringing in investors, who will work with our teams who have skills, reactivate and operate the facilities in these refineries and help us to provide technical support and they will be paid through the flow out of the refined products, over a period of time, while we have also changed the refining model, in such a way that refineries pay for their crude into the federation account, whatever they produce will be sold to the PPMC and the marketers themselves, for which we should be praised actually.

    “The feat recorded will not end fuel importation. Even if the refineries are working at 100 per cent installed capacity, they will provide only 20 million litres daily. Our daily consumption is about 45 million litres. If the three refineries are now functioning, we will have about 12 million litres, far below the 45 million litres. The advantage they bring is distribution. From Port Harcourt refinery, we can distribute to the East. From the Warri refinery, you can distribute to the West. From the Kaduna refinery in the North, you can distribute to the farther areas of the North.”

    In addressing this, Kachikwu observed that “It does not solve the problem completely, but two things will happen. When the upgrade and repairs, led by the foreign investors, with our joint team, are concluded, our capacity will move from about 50 per cent to about 90 per cent, resulting in movement from 12 million to slightly excess of 20 million litres production per day. The co-located refineries that we have also advertised, which will be private sector-led, by the time they are attained in about two years, there will be excess of 750,000 barrels refined petroleum production capacity per day. Our hope is that by 2018, fuel importation will be reduced by at least 60 per cent, because of the upgrade that would have taken place. By 2019, when the co-located refineries are in place, we will actually be exiting importation and begin to export refined petroleum products. That is the strategic way. That is what we are working on.”

    The minister of state for petroleum resources also stated that to secure the pipelines would be a collective responsibility.

    He said: “Securing our pipelines from vandalism is a call to all Nigerians to secure their own assets. We must ensure that the pipelines are protected. Federal Government cannot do it alone. Military has done a yeoman’s job, in terms of supporting us. From the environmental point of view, we must also ensure that we provide things in the communities, that will shift the people’s attention from pipeline vandalism.”

    Kachikwu also thanked God for making the day possible, in spite of all the challenges, while lauding President Muhammadu Buhari, who he said through all the trying times, continued to be with the minister and his team, as well as encouraging them to keep going.

    He said: “I apologise to Nigerians, who have suffered all this time, because of products’ supply, especially those in the North, who bearing a big brunt of this (fuel scarcity), particularly Abuja and Lagos, who are the key consumer cities; Abuja, Lagos and Kano, but we are beginning to recognise now that Lagos is easing off and Abuja is doing the same thing. Once Kaduna begins to produce, the North will see a lot of improvement. Over and above that, we are putting long term policies in place to ensure that while smaller marketers go out and do their stuff, we can then be the key suppliers for the rest of the country.  I told you I will never give up. We have signed the advertisements for investors to come in. There is no confusion about what they are coming to do.

    “We owe Nigerians the duty to ensure that the refineries are working. We cannot give up. I visited a refinery in Cote d’Ivoire, a smaller refinery. One of the things I will hope is to take some of the leadership team to Cote d’Ivoire, spend some time and see the processes that are there and they are almost 100 percent Ivorians-led. So, if they can, we started first and we have the larger profile in terms of refining. So, we will like to see us do the same thing. We will be there and bring in some of that into our system.”

    Also speaking at the commissioning of the multibillion naira crude oil underground pipe line from Escravos to Warri and Port Harcourt, which is expected to deliver crude directly to the refineries rather than the use of marine vessels, he emphasized that fuel queues will soon be a thing of the past in the next one week.

    He thanks the president and said, “This underground pipeline will check sabotage and I can tell you the sufferings of people will soon be a thing of the past.”

    He lauded the contractor, Ocean Marine Solution, chaired by Capt. Hosa Okunbo, saying that despite the fact that the contractor has not been paid before embarking on the job, they did a good job that will help solve the problems confronting the oil sector.

    Capt. Okunbo who attributed the completion of the multi-billion naira project to President Buhari’s determination to bring total reform in the oil and gas sector noted that this was the first time in the last ten years that crude will be delivered to the Warri and Port Harcourt refineries through pipe-lines.

    According to Okunbo, “As I speak to you there is no contract in place because in our industry there is something you call proof of concept and Q and pay. In our company we believe that everything is possible when you have the will, there must be a way and that is what we have achieved today.”

    He lauded the community because they “are able to cooperate with us. We used carrot and stick approach and our security surveillance and also the contract of actually doing the job and replacing the contract. It was very tedious and sometime we almost got killed and threat to our lives which inform why you see all these security around us.”

     

  • FG needs $700m to upgrade refineries – Kachikwu

    FG needs $700m to upgrade refineries – Kachikwu

    The Minister of State for Petroleum, Dr Ibe Kachikwu, said on Saturday that the Federal Government needed 700 million dollars to upgrade its refineries to produce at maximum capacities.

    Kachikwu, who is also the Group Managing Director of NNPC, disclosed this while speaking with newsmen during the re-inauguration of the Port Harcourt/Bonny Crude Supply Line at the Port Harcourt Refining Company (PHRC), Eleme, Rivers.

    He said that due to the fact that the nation did not have such amount, advertisements had been signed for investors to come in.

    According to him, we are not inviting foreign partners to take over the refineries; the total investment for that is up to $700 million and we don’t have that. Let us be honest about it.

    ”So, the best thing to do is to find a very creative way to bring in investors, who will come in, work with our team here;

    ‘’Investors, who have the skills to reactivate and upgrade facilities in this place and help us provide technical support and we will pay through the flow-out of the refined products over time,” he said.

    Kachikwu emphasised that there should be no confusion about what the investors would be coming to do, since they would not come to run the refinery.

    ”They are coming to provide funds to take our performance on these refineries to 90 percent and to provide us with technical skills.

    ”So, the areas of intervention will be funding and technical support,” he said.

    Kachikwu said that at present, Nigerians were consuming about 45 million litres of PMS daily, while the refineries were producing 12 million litres daily as they were working at 60 per cent capacity.

    He said that the nation will need to upgrade these refineries and let them develop to the point where they can perform up to 90 per cent.

    He said that by the time the refineries were upgraded and they start producing at 90 per cent, about 20 million litres would be produced daily.

    The minister said that with such production, it would only meet up with about half of the country’s consumption.

    Kachikwu, however, apologised to Nigerians for their suffering due to the fuel scarcity and also thanked Nigerians for their patience.

    He explained that the government had been able to recover the two critical crude supply pipelines; which were Escravos/Warri and Bonny/Port Harcourt crude supply pipelines.

    Kachikwu said that the pipelines were down for six to seven years but had been repaired and were working and supplying crude to the refineries.

    ”For the first time, the refineries will get their crude, pay for it, they will sell their products and they will earn the income from that product.

    ”And then, they can develop and continue to maintain the refineries even after this intervention is over.

    ”Port Harcourt is back in production, Warri is back in production; Kaduna today is receiving and will soon be back in production. It is something of joy,” he said.

    Kachikwu said, ”Lagos is easing off now from fuel scarcity and Abuja is doing the same thing; once Kaduna begins to produce, the North will see a lot of improvement.

    ”Over and above that, we are putting long term policies in place to ensure that while smaller marketers go out and do their stuff, we can then be the key suppliers for the rest of the country.”

    He commended the workers and the contractors for a job well done; adding that he has signed the promotion letters of the PHRC staff as they deserved to be rewarded.

    Kachikwu, however, said there is a lot still to be done, ”I told you I will never give up.

    ‘We owe Nigerians the duty to ensure that the refineries are working. We owe Nigerians that, we can’t give up,” he said.

    The minister urged Nigerians to remain resilience, “support what the government is doing because this is the only way to change the system.”

  • Refineries: NUPENG warns NNPC over partnership with investors

    Refineries: NUPENG warns NNPC over partnership with investors

    The Nigerian Union of Petroleum and Natural Gas Workers (NUPENG) has urged the Nigerian National Petroleum Corporation (NNPC) not to engage investors as joint technical partners for the rehabilitation and running of refineries.

    The NNPC has advertised for the job.

    The union said it is also worried by similar adverts by the NNPC inviting pre-qualification for rehabilitation, upgrade, operatorship, management and maintenance of NNPC jetties, storage depots and pipeline infrastructure on joint venture partnership.

    In a statement by its Acting General Secretary, Comrade Joseph Ogbebor, NUPENG described the NNPC’s move as privatisation of national assets through the backdoor.

    According to Ogbebor, it is doomed to fail and bring more hardship to the citizens like the  Power Holding Company of Nigeria (PHCN).

    Ogbebor, NUPENG would fight the joint partnership bid for security reasons and in the interest of oil and gas workers.

    No investor, he said, would want  his money in the JV without having a say in the running of the refineries, storage depots and jetties.

    “NUPENG states that the panacea to these challenges is not in joint partnership basis that will alter the ownership and operatorship structure, but the need to have the political will to make the refineries, pipelines, and storage depots work optimally,” the union said.

    The bidders, it said, would turn out to be those interested in buying the national assets adding that their planned sale through this method is a failure on the part of the NNPC management.

    “It also negates Federal Government’s plan to set-up a special task force to tackle pipeline vandalism and encourage investors to build refineries within the old refineries and use their facilities.

    “NUPENG calls on President Buhari to call the Minster of State, Petroleum Resources, Dr. Ibe Kachikwu, to order and rescind the decision and concentrate on re-streaming the refineries, rehabilitate the depots instead of this new plan of partial privatisation through the backdoor that will result to job losses. This may lead the union to embark on a nationwide action,” Ogbebor said.

  • Fuel supply: Osinbajo, PETAN back modular refineries

    Fuel supply: Osinbajo, PETAN back modular refineries

    •Let private investors run refineries

    The Vice President, Professor Yemi Osinbajo, has endorsed the building of modular refineries to solve the recurrent fuel scarcity in the country.

    He spoke at the two-day 2016 African Modular Refinery seminar in Lagos. Osinbajo, who was represented by Ambassador Jide Olu, in his goodwill message, highlighted the need for modular refineries, noting that they will not only address the fuel scarcity problem but move Nigeria away from being a net exporter of crude oil to a big producer and net exporter of petroleum products.

    He said there was no better time to start than now because of changes in the global oil and gas space. Rather than merely extracting crude oil and exporting it and importing finished products, Nigeria should take full advantage of the oil and gas sector by refining crude and exporting it. That will mean full use of the oil and gas resources, he added.

    He said: “The advent of shale oil and gas is a technological revolution that has changed the oil market, moving to an era of long low oil prices. We, therefore, need to add value to our oil and gas resources to remain competitive.

    “It is in this regard, the Federal Government will prioritise the adoption and execution of a National Oil and Gas Master Plan later this year,” adding that Nigeria and Africa should think of modular refinery in the content of regional value gains and market sizes since production is increasingly coordinated across various geographical locations.

    The Chairman of the Petroleum Technology Association of Nigeria (PETAN), Mr. Bank-Anthony Okoroafor, also agreed with the Vice President on the need to build more modular refineries to enable self-sufficiency in fuel production.

    Okoroafor urged the Federal Government to allow the four refineries it owns to be run by private investors to make them operate and produce optimally.

    In a chat with reporters, he said government has no business running refineries but to make policies that would drive business activities. “Refinery business is a business on its own. Governments do not run such businesses. It was good at the initial stage for government to kick-start such investments and be able to build capacity.Government has no capacity to run refineries,” he said.

    The PETAN chief criticised giving jobs in onshore and swamp terrains to foreign oil companies when competent indigenous companies are available. He said that the association is keen to achieve value added local content to Nigerians.

    He said PETAN’s goal is to bring jobs hitherto exported to other countries back to Nigeria, create a hub for oil and gas service in-country. He said before now, Nigeria loses $380 billion and two million jobs to capital flight on oil and gas service jobs.

    He said there is a Nigerian Content Law, which states that 100 per cent onshore, swamp jobs should be given to Nigerian companies.  “So any job that can be done by PETAN company or by a competent Nigerian  should not be given to somebody outside the country, it is criminal,” Okoroafor said.

    However, where there is skills gap, PETAN encourages alliance with foreign companies, primarily to grow capacity. He said at the height of militancy in the Niger Delta, expatriates fled the region while indigenous companies’ workers continued with the jobs without fear of being kidnapped.

    “Nobody can develop our country better than we can do. But anywhere that the capability does not exist in the country, anybody can do the job. But where the capability exists, it has to be done by the  Nigerian company,” he said.

  • Nine firms bid for co-location of refineries

    Nine firms bid for co-location of refineries

    Nine firms are bidding for co-location of new refineries.

    They are to operate within the four refineries in Kaduna, Warri and Port Harcourt.

    The bid submission yesterday was witnessed by representatives of the Nigerian Extractive Industry Transparency Initiative (NEITI) and the Bureau for Public Procurement (BPP).

    The names of the companies were not disclosed.

    NNPC Chief Operating Officer (Refineries) Mr. Anibo Kragha described the open bidding as a demonstration of the determination of the Federal Government to increase the nation’s refining capacity from 445,000 barrels per day to 650,000.

    “The aim is to leverage on the existing facilities to fast track the take-off of the refineries as soon as possible,” he said

    According to him, a technical evaluation committee has been set up to study the bids and announce winners as soon as possible.

    Tthe corporation’s General Manager, Supply Chain Management, Sophia Mbakwe, enjoined all the companies to accept the outcome with a promise that it will be transparent.

    She added that all the rules of public procurement as spelt out in the Bureau for Public Procurement Act would be strictly adhered to.

    General Manager, Group Public Affairs Division Garba Deen Muhammad, said the corporation was committed to boosting the nation’s refining capacity, which will stop the perennial fuel scarcity.