Fourteen months
after the advent of the current administration, the three refineries belonging
to the Nigerian National Petroleum Corporation, NNPC, are yet to be fixed, with
the refineries producing an average of 47,553 barrels of crude oil per day
(BPD) over the last one year.
This is a far cry
from their combined installed capacity of 445,000 barrels of crude oil per day
(BPD).
Port Harcourt Refining Company, which is made up of two refineries, has
a combined capacity of 210,000 barrels per day (BPD); while Kaduna Refining
& Petrochemical Company Limited (KRPC) and
Warri Refining & Petrochemical Company Limited (WRPC) have installed
capacities of 110,000 BPD and 125,000 BPD respectively. A document obtained
from the NNPC, yesterday, revealed that the refineries are still undergoing
repairs, rehabilitation and Turnaround Maintenance (TAM), a situation that
ensured that local refining capacity remained below commercial threshold.
According to the document, the NNPC said refineries rehabilitation is on course
to address the perennial shortage of fuel in the country, noting that this was
in addition to co-locating of smaller refineries to leverage on the existing
facilities and boost the nation’s refining capacity from 445,000 barrels per
day to 650,000 barrels per day.
This is continuation of the trends witnessed in
previous administrations, where the refineries were subjected to unending
repairs and TAMs, with billions of dollars allocated on a yearly basis for such
rehabilitations.
However, efforts to get the spokesperson of the NNPC, Mr.
Muhammed Garba-Deen to comment on the never-ending repairs of the refineries
and their current status proved abortive, as they refused to respond to text
messages sent to their phones. However, the NNPC, in its Financial and
Operations Report for the Month of June 2016 released weekend, stated that
about 75.26 per cent of the total Domestic Crude Oil supply for May 2016 was
utilized via Direct-Sale-Direct-Purchase (DSDP).
The DSDP was introduced by the
NNPC to replace the crude oil for product exchange arrangement, also known as
crude oil swap, and the Offshore Processing Agreement (OPA).
The NNPC allocates
445,000 barrels of crude oil daily to the refineries for local consumption,
majority of which are processed outside the country, based on the arrangements
in place at that point in time; while only an insignificant portion is
processed by the refineries, based on their capacities at any point in time.
Also, the NNPC disclosed that total crude oil processed by the three
refineries, KRPC, PHRC and WRPC, for the month of June 2016 was 225,770 metric
tonne (MT) and equivalent of 1,655,345.99 barrels.
This translates to an
average production of 55,178 barrels daily. Out of the total of 225,770 MT
processed by the refineries in June, the NNPC stated that they produced 133,991
MT of finished Petroleum products, an equivalent of 982,422 BPD. This
translates to an average daily output of 32,747 BPD of petroleum products.
The
NNPC blamed the poor performance of the refineries on crude pipeline vandalism
in the Niger Delta region coupled with on-going Refineries revamp; noting,
however, that the three refineries continue to operate at minimal capacity.
The
Minister of State for Petroleum Resources, Mr. Ibe Kachikwu, had on different
occasions stated that the refineries returned to production, while at one
point, he said the country needs about $700 million to upgrade and fix the
refineries.
However, the recently appointed Group Managing Director of the
NNPC, Mr. Maikanti Baru, had a few days ago, stated that the corporation would
collaborate with the Spanish National Oil Company, REPSOL, to improve the
technical capacities of the refineries.
Baru hinted that the NNPC might
consider bringing in petroleum products to the country from REPSOL to help meet
domestic demand of the product, while efforts are made to fix the refineries.
According to him, NNPC as an integrated Oil and Gas Company is currently
undergoing transformation which includes increasing its refining capacity. He
said, “As you know, we have challenges with our refineries and with REPSOL
refining about 900,000 barrels of crude oil per day, we can collaborate on
that, going forward.
“While we are fixing our refineries, we also have the
opportunity to bring in more petroleum products into the country to meet our
domestic needs.”
Vanguardngr
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