BusinessPH Refinery Maintenance Set to Enter Q2 2024

PH Refinery Maintenance Set to Enter Q2 2024

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March 24, (THEWILL)- The unending repairs of Port Harcourt Refinery is set to enter the second quarter of 2024 after missing the December 2023 target.
The Federal Government had, through the Nigerian National Petroleum Company Limited (NNPCL), emphatically assured that the facility would resume production in December.
The “commitment” was extracted from the government after organised labour had embarked on a nationwide strike over the hardship resulting from the removal of the subsidy on petrol. It also accused the President Bola Tinubu-led government of pushing the refinery repairs to the back burner.

The four local refineries in Nigeria, including the two in Port Harcourt, had stopped operations in 2019, yielding the country to full importation of its petroleum requirements.
This has drained the nation’s resources extensively as it spent the bulk of its oil revenue on “subsidy” while it also suffered huge losses from massive oil theft which the NNPC put at $10 billion in 2022 alone.
As a result, the NNPCL made zero remittance to the Federation Accounts Allocation Committee (FAAC) in 2022 arising from the challenges of oil theft and payment of “under-recovery,” a euphemism for subsidy.

In a dramatic change of events, the Federal Government in December confirmed the “commencement of operations” at the Port Harcourt Refinery.
It announced that the facility commenced operations on December 20, 2023, as the first phase of work at the plant had been completed, adding that refined petroleum products would start flowing from the refinery after the Christmas break.
The government had earlier in the year repeatedly stated that the Port Harcourt refinery would begin operations before the end of 2023.

Glo

The Minister of State for Petroleum Resources (Oil), Senator Heineken Lokpobiri, who led members of the Refinery Steering Committee to inspect the facility, congratulated the Nigerian National Petroleum Company Limited and Nigerians in general for the feat.
“In our quest to ensure that this refinery is re-streamed to continue to deliver value to Nigerians, we made a promise that we will reach a mechanical completion of phase one of the rehabilitation project by the end of December and get the other plants running in 2024. Today, we have kept those commitments,” a statement quoted NNPCL Chief Executive Officer, Mele Kyari as announcing during a facility tour of the plant.

However, industry experts and inner members of the Refiners have countered the claim by NNPC, maintaining that the refinery was far from the state of resuming actual production.
Among these is Engr Alex Ogedegbe, a former Managing Director of Port Harcourt and Kaduna Refineries at different times who explained that the so-called fulfilled promise was a hoax.

“From the analysis of the information published so far it does not appear that the refinery can start any production in the foreseeable future,” Ogedegbe disclosed in a statement, adding, “It is also noteworthy that the main contractor, TECHNIMONT did not promise any mechanical completion or production start-up dates.”
Last week, the Group Managing Director of NNPC, Mele Kyari, announced April 2024 as a new date for the Port Harcourt refinery to resume operations.
In a statement, the NNPCL chief explained that mechanical works, again, have been completed on the facility which had received over 450,000 barrels of crude, following delivery from active lines.

December 2023.
THEWILL recalls that the Senate on October 24, 2023 constituted an ad-hoc committee to investigate all contracts estimated at over N11.35 trillion awarded for the rehabilitation of the four moribund refineries in the country.
This followed a motion brought by Senator Sunday Karimu on the unending repairs of the nation’s refineries despite the huge resources invested in fixing them.
He added, “We are concerned that the Federal Government of Nigeria has carried out rehabilitation projects in Port Harcourt Refinery Company (PHRC) over a period of seven (7) years from 2013-2019 at an estimated cost of N12,161,237,811.61. In addition, on the 18th March 2021, a rehabilitation contract was executed between NNPC/PHRC and Tenenimont SPA at a Lump Sum of $1,397,000,000.00, about N75 billion naira amidst global public criticism, no result has been achieved.

While Nigerians were still expecting the outcome of the Senate probe of the refinery repairs, the federal lawmakers on February 20, disclosed that the upper legislative chamber had resolved to probe how the N30 trillion Ways and Means loans of the Central Bank of Nigeria was obtained and spent by the administration of former President Muhammadu Buhari.
Meanwhile, unconfirmed reports revealed that the government engages in ‘secret’ payment of subsidies amounting to over N17 billion daily following the rise in price of oil at the international market.

About the Author

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Sam Diala is a Bloomberg Certified Financial Journalist with over a decade of experience in reporting Business and Economy. He is Business Editor at THEWILL Newspaper, and believes that work, not wishes, creates wealth.

Sam Diala, THEWILLhttps://thewillnews.com
Sam Diala is a Bloomberg Certified Financial Journalist with over a decade of experience in reporting Business and Economy. He is Business Editor at THEWILL Newspaper, and believes that work, not wishes, creates wealth.

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