By: Ali Muhammed Zanna
The Nigerian National Petroleum Corporation NNPC has audited the governments ailing refineries and mobilised funds and technical resources to restore them to full operating capacity within the shortest possible time to crash fuel prices and guarantee energy security.
The move has been applauded by industry experts and consumers, especially now that the government has discarded the contentious subsidy regime and embraced full deregulation where market forces determine the price of petroleum products.
While energy challenge has remained the blight of the nations economy, for decades, global records show that Nigeria is about the only major oil-reliant country without local refining capabilities.
This scathing development has drained its lean foreign reserves through scandalous deals that entail exporting premium crude oil and importing low-grade refined products in return.
To change the ugly narrative, the Group Managing Director of the NNPC, Mr Mele Kyari at a recent interview said the nations four refineries Kaduna, Warri, Port Harcourt and Indorama Petrochemical, Eleme, are set for major rehabilitation. The refineries have a combined capacity of 444,000 barrels per day.
The NNPC chief said they were shutdown having been starved of the mandatory routine turnaround maintenance TAM and major rehabilitation; despite the huge chunk of money voted for them over the years.
To save cost and hefty consultancy fees, in the programme to rehabilitate refineries, the NNPC has looked inwards and leveraged local competence by appointing its engineering subsidiary, National Engineering and Technical Company, as Owners Engineer for the Port Harcourt and Warri refineries in May.
The NNPC management has also invited tender for the repair of Port Harcourt refinery and signed a $1.5 billion prepayment deal that will see it selling crude to some oil trading firms in exchange for the prepaid money.
The financing package, called Project Eagle, was backed by the African Export Import Bank Afreximbank.