The Federal Government, investors and other stakeholders are looking forward to producing petroleum products from Waltersmith Modular Refinery in May, writes JOHN OFIKHENUA
Investors are now overcoming their early reluctance to activate their modular refinery licences. Their decision to construct and operate the entities is coming after years of fear of government’s refusal to fully deregulate the downstream petroleum sector.
In the lead for the venture into the race for modular refinery operation is Waltersmith Modular Refinery. The firm is looking forward to meeting consumers’ demand for petroleum products by May, 2020.
Also, Aziken Modular Refinery and five other refineries are working hard to satisfy the domestic market. This is also ahead of the Nigerian National Petroleum Corporation (NNPC) Group Managing Director (GMD), Mele Kayri’s vow to ensure that the country exited the importation of petrol by 2023.
Minister of State for Petroleum Resources Timipre Sylva recently inspected the Waltersmith Modular Refinery located in Ohaji/Egbema Local Government Area, Imo State during a visit. His mission was to inspect the ongoing works in the refinery construction which is at an advanced completion status of over 90 per cent.
Accompanied by the Executive Secretary of the Nigerian Content Development Monitoring Board (NCDMB) Simbi K. Wabote, an Engineer, the minister expressed his excitement at the pace of work at the project, noting that “the incorporation of the Modular Refinery component in the existing business concerns of Waltersmith Petroman Oil Limited, is exactly what was envisaged by the Federal Government with marginal fields allocation.”
He stated that “the overall expectation was to see Nigerian companies do well and the Waltersmith Modular Refinery is a major bright spot which has recently been incorporated into the nation’s projection for petroleum product sufficiency and availability.”
Sylva praised the Board and Management of Waltersmith Petroman Oil Limited for their efforts, even as he implored that a huge focus should be placed on corporate social responsibility to ensure a sustained and successful relationship with the host community.
He praised Wabote for executing the project partnership for the 30,000 barrels per day modular refinery which is wholly owned by Waltersmith Petroman Oil Limited with a key equity investment from the Nigerian Content Development and Monitoring Board (NCDMB). He pledged the commitment of the Federal Government in ensuring that the expected completion date and refinery operations commencement date of May, 2020, is achieved.
NCDMB’s Executive Secretary Simbi Wabote said the partnership forged with Waltersmith Petroman Oil Limited, has clearly shown the power of public-private investments, while noting that all the necessary steps have been put in place to ensure the full realisation of the objectives of the project.
He further noted that the initial partnership with Waltersmith Petroman Oil Limited was stemmed from the quest to achieve President Muhammadu Buhari’s aspiration to improve in-country refined products capacity. He expressed his optimism that the May, 2020 completion date of the phase 1 (5,000 barrels per day) will coincide with the groundbreaking for the phase 2 of the project targeted at delivering 25,000 barrels per day crude and condensate refinery; designed to produce gasoline, diesel, LPG, kerosene and aviation fuel.
The Chairman of Waltersmith Petroman Oil Limited, Mr. AbdulRazaq Isa noted that the fundamental reasons for embarking on the Waltersmith Modular Refinery include but not limited to crude loss resulting from crude handling and the cost of crude transportation from the marginal fields owned by Waltersmith Petroman Oil Limited.
He noted that the project owners, Waltersmith Petroman Oil Limited (70 per cent) and NCDMB (30 per cent) have worked assiduously to ensure the phase 1 delivery timeline which has been pegged at 18 months. He stated that the phase 1 is expected to contribute about 271 million litres of refined products, including diesel, naphtha, HFO and kerosene annually to the domestic market and create both direct and indirect jobs particularly within the host communities.
The Managing Director/Chief Executive Officer of Waltersmith Petroman Oil Limited, Mr. Chikezie Nwosu explored the current status of the Modular Refinery project, noting that the 30,000+ barrels per day is a partnership between Waltersmith (70%) and NCDMB (30%) with NCDMB providing major guidance and contributions on Nigerian Content, Technical and Commercial issues and Corporate Governance. He recalled that the FID for the Refinery Project was taken in September 2018 with an 18-month delivery time from November, 2018 to May, 2020, for Phase 1.
The Waltersmith Petroman Oil Limited purposely invited the minister to have firsthand information on the projects and also see things for himself. From the company’s presentation to Sylva, it was obvious that the Final Investment Decision for the 30,000 bpd modular refinery project was taken in September, 2018 with an 18-month delivery time from November, 2018 to May, 2020, for Phase 1.
The firm, which is completely indigenous, was established in 1996 for exploration and production. The company has been undertaking activities such as exploration, production and services and gas and power. Its Ibigwe’s hub is of 30 kilometers radius centered on the Ibigwe Field Flow Station. It produced its first oil in 2008, from when it has sustained a total of 12 million barrels of crude oil per day.
The company has embarked on the construction of a WS/NCMB 30,000 of both oil and condensate barrel per day refinery. While its inauguration is billed for May, 2020, the ground- breaking ceremony for phase two which is 25,000 barrel per day is also scheduled for the same month.
A sister company-Waltersmith Ughamma Power Company is also developing a 300mw power plant for which it has already delivered the feasibility study.
According to the firm, the Final Investment Decision of the project is slated for the fourth quarter of 2020. The 300Mw combined circle power plant is to be delivered in phases, with 50mw as the first phase mostly for own use at the park.
Part of the plan is also the 32 km transmission line to Owerri sub-station from which power will be sold through the Nigerian Bulk Electricity Trading (NBET) Plc to the Nigeria National Electricity Grid. This, according to the firm, is expected to create 6,650 jobs during construction and 950 during operations.
The project also has the plan for additional capacity to contribute towards bridging the supply gap in the country. It has said it will provide power for 118,000 households and 26,000 commercial /industrial users. The company, according to the presentation, has secured a power generation license for Waltersmith Ughamma Power Plant. It has also proposed Egbema as a main source of feedstock gas for power plant.
The company dropped the hint that the Environmental and Social Impact (ESIA) for the Department of Petroleum Resources (DPR) has been completed. While it has also activated the discussions for Grid Connection, and Co-operation Services Agreements at the Transmission Company of Nigeria, it has also made some reasonable progress in terms of the Gas Sales and Purchase Agreements.
On the Walterssmith Energy Industrial Complex, the presentation said the company has acquired 65 hectares of land for construction of Energy Industrial Complex. While it has completely surveyed 500 hectares of land, it has also initiated the process for its acquisition.
The Waltersmith Petroman Oil Limited is also involved in the provision of crude oil handling services to Seplat, the NNPC with its significant efforts at safeguarding production through the Ibigwe Flow Station. It has also commenced discussions to strategically support the security of production of hydrocarbons in Egbema, Assa and Assa North /Ohaji (ANOH) condensate through the 30,000 bpd refinery project.
It is also involved in Energy Industrial Park Project from which it delivers energy gas and petrochemicals, renewable energy and other commercial businesses, basically for the opening up of the Ibigwe hub. The hub, said the company, will deliver significant Light Tight Oil (LTO) for all operators and partners such as the NNPC, ENI, Seplat, Waltersmith and NCDMB in the area.
The firm invited the minister to the inauguration of its new Corporate Head Office in Lagos. It also pleaded with him to be present at the inauguration of Phase 1 of the modular refinery, and the groundbreaking ceremony of the phase two in May.
The company called on the ministry to support its ongoing commercial farm in discussions with the SPDC JVC and NNPC, for security of production and refinery feedstock.
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