The Nigerian National Petroleum Corporation (NNPC) said on Tuesday it was inching closer to finalising the financing for the major rehabilitation of its four refineries, as the corporation battles to increase local production and supply of petroleum products amid the continued shortages.
The development holds the promise to boosting petroleum products supply and distribution in the Country
Maikanti Baru, group managing director of NNPC, disclosed this while briefing members of staff of the corporation on the fuel supply situation in the country during a town hall meeting Tuesday in Abuja.
Baru said agreements on the potential financiers for the refineries were being fine-tuned, following which the endorsement of the NNPC Board would be this month.
“We are pushing towards the final selection of our financiers and we expect that when that is done, we’ll get the agreements and present them to our board, meeting this month to secure their endorsement and once we have the funding, we would start the rehabilitation of the refineries towards a 90 per cent capacity utilisation per stream day before the end of 2019,” Baru said.
He described the procedure for electing the financiers as painstaking, noting, however, that it was necessary to enable a desired closure on the subject.
The refineries located in Port Harcourt, Warri and Kaduna with combined capacity of 445,000 barrels per day, were operating at just 11.9 per cent capacity utilization as at October 2017.
Baru said the corporation was also encouraging new refining capacities to come on board, adding that there were two consortia that have indicated interest to co-locate refineries in Warri and Port Harcourt.
He said NNPC would provide whatever utility services the companies might require, such as power, processed steam, water and land, stressing that the corporation has agreed in broad terms on areas of collaboration to fast track the development.
“I am happy to inform you that progress has been made, up to the level of an acceptable detailed engineering design and we are in the process of mobilizing some of the refineries already identified for installation in Nigeria,” the GMD said.
He said the Kaduna State Government was also championing a proposal to co-locate another refinery close to the KRPC with the intent of sourcing Nigerien crude for its operations.
Dr. Baru stated that other Greenfield refineries were to be brought on board soon in Kano and Kaduna, stressing while on board, they would source their crude from Niger Republic.
He said the designs for the proposed refineries in Kano and Kaduna were ready, saying their construction would commence this year.
The NNPC chief executive revealed that the Ministry of Petroleum Resources and the corporation were collaborating to encourage the establishment of modular refineries in the Niger Delta area to encourage job creation.
“So far, about 35 interests for modular refineries have been declared and the Department of Petroleum Resources (DPR) has issued licenses to about 13 and I have been invited to the ground breaking ceremony of the first one in Bayelsa next month,” Baru said.
He noted that the Federal Government and the NNPC would continue to encourage private sector initiatives that would bring in competition in the petroleum products supply and distribution network so as to guarantee energy sufficiency for the country.
Baru hinted that the corporation was also exploring other sources of energy that could substitute premium motor spirit (PMS), otherwise known as petrol, in cars and motorcycles, saying the use of compressed natural gas (CNG) to power vehicles in Benin City is the right step in the right direction.