Page 6 - AfrOil Week 10 2022

AfrOil COMMENTARY AfrOil

Price deregulation needed as

Nigeria eyes refining progress

Nigerian officials call for fuel market liberalisation as refining progress continues

NIGERIA is anticipating significant progress in several modular refining projects for a minor-
on its refining renaissance this year with several ity equity stake, is acting as a catalyst to enhance
WHAT: facilities seen coming into operation. However, the realisation of the refining roadmap.
New modular and con- concerns have been raised that smaller facili- He said that this approach had helped to
ventional refineries are ties are being hamstrung in providing gasoline facilitate the development of the operational
seen changing Nigeria’s supplies to remote areas because of state pricing Waltersmith Modular Refinery in Imo State,
economic landscape over regulations. which has a capacity of 5,000 bpd with plans to
the next year. The country’s current refining slate is lim- gradually increase this to 45,000 bpd.
ited to 22,000 barrels per day (bpd) across four “Next in view is the 2,500 bpd Duport Mod-
WHY: modular refineries across the states of Delta, ular Refinery located in Edo State, [which is]
Delegates at a recent Edo, Imo and Rivers, but could surpass 550,000 due for commissioning by the second quarter
conference argued that bpd by the end of the year and rising yet further of this year,” Wabote added. This suggests that
the fuel market needs
major change to ensure in 2023. the facility’s timeline has shifted, as developer
continued investment. Duport Midstream Co. said in mid-February
Progress report that the plant would be launched during March.
WHAT NEXT: Speaking at the Nigeria International Energy At launch, the project at Egbokor Energy
With ambitious plans in Summit (NIES) last week in Abuja, Simbi Park will comprise 2,500 bpd of refining capac-
place to ramp up refining Wabote, executive secretary of the Nigerian ity, a 5-MW power plant, a 40 mcf (1.13 mcm)
capacity, incentivising Content Development and Monitoring Board per day gas processing facility, 20,000 tonnes
these new facilities to (NCDMB), reiterated the country’s plans to (1.5mn barrels) of crude storage, which are seen
operate at capacity is achieve a domestic refining capacity of more increasing to 10,000 bpd, 60 mcf (1.7 mcm) per
next on Abuja’s agenda. than 1.4mn bpd by the end of 2027. day and 50 MW respectively, with a 10 mcf (0.28
Wabote noted that President Muhammadu mcm) per day CNG facility to be added later.
Buhari’s Refining Roadmap would seek to reach Wabote noted that other modular facilities
this level through the “rehabilitation of exist- under construction include the 12,000 bpd
ing four national refineries, co-location of new Azikel Hydroskimming refinery in Bayelsa and
refineries, construction of greenfield refineries the 2,000 bpd Atlantic International Refineries
and construction of modular refineries.” and Petrochemical Ltd unit at Okpoama.
Alluding to ongoing work by Nigerian Speaking to NewsBase, IGM Energy owner
National Petroleum Corp. (NNPC) across its and principal advisor Ian Simm said: “Nigeria’s
chronically under-utilised refining slate, he said: current active refining capacity is limited to
“About 400,000 bpd is expected from the reha- Waltersmith (5,000 bpd), the OPAC Refineries
bilitation of NNPC refineries in Port Harcourt, facility in Delta (10,000 bpd), the Niger Delta
Warri and Kaduna using target performance Petroleum Resources (Train 3) plant in Rivers
of not less than 90% of nameplate capacity [of (1,000 bpd) and the Edo Refinery and Petro-
445,000 bpd].” chemical Company Ltd in Edo (6,000 bpd).”
Meanwhile, he added that the “mechani- He added: “The new modular launches are
cally complete Dangote Refinery in Lagos and seen adding another 16,500 bpd this year, and
the BUA Refinery in Akwa Ibom are expected including start-up at Dangote, the country’s
to deliver refining capacity of 650,000 bpd and refining slate could grow to 579,000 bpd by
200,000 bpd respectively,” though did not give a year-end.”
date for the launch of the latter. For his part, Wabote said: “As we get closer
In January, Aliko Dangote, the president of to the realisation of this scenario, it enables us
Dangote Industries, said he anticipated his hold- to see oil as a resource rather than a commod-
ing’s new refinery to begin operating before the ity for trading. It means value addition to this
end of September 2022 at an initial capacity of resource for the production of other items and
540,000 bpd, with full capacity to be reached in consumables.”
early 2023. He added: “A barrel of oil utilised as a
resource generates multiple products that are
Modular momentum utilised in transportation, construction, avia-
Wabote said that NCDMB, which has invested tion, agriculture and others.”

P6 www. NEWSBASE .com Week 10 09•March•2022