Page 6 - AfrOil Week 24 2021

AfrOil COMMENTARY AfrOil

It has devoted a larger share of federal revenue to illegal oil refining.
investments in communities near the delta oil- According to a statement from NCDMB,
fields, it has launched training and educational the parties signed a shareholders agreement last
initiatives and it has tried to come to terms with week on the construction of the Brass Petroleum
local militant groups. Products Terminal (BPPT), a facility that will
In 2000, it established a government depart- distribute refined fuels in the Niger River Delta.
ment known as the Niger Delta Development BPPT will be capable of storing 50mn litres of
Commission (NDDC) to promote economic gasoline, diesel, jet fuel and kerosene, and will
growth in the region. (Buhari dissolved NDDC’s also serve as a strategic reserve for Nigeria, the
board in 2019 and has not yet appointed replace- statement said.
ment members, but Minister of Niger Delta According to Timipre Sylva, Nigeria’s Min-
Affairs Godswill Akpabio recently promised to ister of State for Petroleum Resources, the
rectify this situation in the near future.) project will help maximise the availability and
affordability of fuel supplies in the region. “Con-
Small-scale refining strategy struction of this depot in the Niger Delta is a big
And now it also plans to experiment with legal- milestone, as the people in the riverine areas
isation of some of the activities that have bedev- buy petroleum products [at] five times the price
illed IOCs working in the region. According other people purchase it,” he remarked.
to Eta Enang, a Nigerian senator who serves
as a special advisor to President Muhammadu Supply shortages, or something deeper?
Buhari on Niger River Delta affairs, Abuja is Sylva went on to assert that illegal refining had
looking to stop banning and start regulating become a problem because of the delta region
small-scale oil processing. often experienced fuel shortages. “This project
“We are working on the policy that will reg- will assuage the problems of the Niger Delta
ulate the operations of artisanal refineries in and will curb illegal refining occasioned by lack
the Niger Delta. It will soon be operational,” of access to [fuel],” he said. “With this happen-
Enang said last week, according to a report from ing, we will have products at the same rate as
Agence Ecofin. anywhere.”
The senator did not explain exactly what the It was not immediately clear whether the
legalisation plan would entail or when it would BPPT project would have any ties to the legali-
be launched. As such, it is not yet clear what sation initiative announced by Enang. If it does,
Abuja intends to do – whether it will turn a blind it might help alleviate some of the delta region’s
eye to local refining operations that secure feed- problems – not just by increasing fuel supplies
stock by siphoning oil from pipelines (or, occa- in the delta region, but also by tying small-scale
sionally, by diverting tankers from their planned refiners into a distribution hub that serves local
destinations), whether it will help make legal communities.
connections between upstream operators and But if it does not, it might not make much of
small-scale refiners working in the delta region a difference. Instead, it would demonstrate that
or whether it will pursue some other remedy. Sylva and other officials in Abuja are assuming
that the Niger River Delta’s travails are largely (or
BPPT initiative perhaps even completely) the result of supply
This lack of clarity is evident in the fact that problems and not a symptom of a deeper and
Enang spoke shortly after two state-run organ- more complex situation.
isations – the Nigerian Content Development In the meantime, Nigerian federal authori-
and Monitoring Board (NCDMB) and Nigerian ties might benefit from divulging more details
National Petroleum Corp. (NNPC) – teamed up of their plans for legalising small-scale refining
with ZED Energy for a project designed to curb in the region. ™

Illegal refining facility (Photo: Defence HQ Nigeria)

P6 www. NEWSBASE .com Week 24 16•June•2021