Page 15 - DMEA Week 14 2022

DMEA NEWS IN BRIEF DMEA

If they do that, it means if you refine these of what is being done. Before now, when we region as a whole pose as birthplaces for
products, you are going to have the price say refineries were being maintained and so, hydrocarbon and renewable energy, which are
similar to what is obtainable abroad. But the so amount of monies were being released, projected to lead the hydrogen revolution in
only difference is the cost of transportation. If Nigerians including myself, were always the near future, the CEO emphasized.
you refine the products in Nigeria, you may skeptical. The question was “are we sure that ARAB NEWS
not need those big mother vessels to transport this money is going to be used for what it is
the products. earmarked? Part of what we did was to ensure Zambia converts Tazama in
So, that may reduce the price. But 80 that no money is released to politicians.
per cent, if not more, of the cost of PMS is So, when the Port Harcourt refinery was bid to ease fuel supplies
reflected on the crude oil price. sanctioned, that they should go ahead with the
The greatest problem is our exchange rate. rehabilitation, since 2004 there has been none. Zambia is converting its Tazama crude oil
If you refine the PMS in Nigeria, let’s assume I state this in our honour as an association, pipeline to enable it to transport refined fuel
at 0.5 cent per litre, you want to sell in Nigeria, no single turn around maintenance in Port products from the Tanzanian port of Dar es
you have to convert it to our local currency Harcourt refinery for example. You have big Salaam to the landlocked country’s copper-
and that is the naira. Because the input is sold announcement over the media but at the mining region in order to ease erratic fuel
in dollars, you will have to convert that dollar end of the day, how much was released to shortages, its finance minister said Thursday.
to naira and in the process of converting maintain these refineries? This particular The conversion of the 1,060-mile pipeline,
dollar to naira, you will use applicable maintenance, Nigeria is borrowing $1billon also known as Tanzania-Zambia Crude Oil
exchange rate. So, even if you use CBN from Afreximbank. Pipeline, is expected to be completed by June
exchange rate, say N400, when you multiply VANGUARD this year, Situmbeko Musokotwane said.
it by 0.5 cent it is quite high. Local refining is “This will reduce the transport cost of
good and it has a lot of positive effects. fuel,” he said in a speech to parliament. “The
When you refine locally, lots of jobs will PIPELINES international oil prices have had an adverse
be created directly or indirectly. If you refine effect on the pump prices of petroleum
locally, there are also secondary derivative Snam invests in ADNOC gas globally and Zambia has not been spared.”
companies that will spring up. Fertiliser The pipeline was built in the late 1960s and
companies need the byproducts from the pipelines has been transporting crude oil for refining
refineries, urea companies, ceramics; plastics at the 40,000 barrels-a-day Indeni Petroleum
and so on, need the byproducts from these Italian energy infrastructure company, Snam Refinery, located in the mining city of Ndola
companies. will invest a total of $250 million in UAE in the Copperbelt Province. But years of
If you recall, Eleme Petrochemicals state-owned oil company The Abu Dhabi inadequate maintenance and investments have
now Indorama, was built in Port Harcourt National Oil Co. with expected returns of 10 left both the pipeline and refinery operating
because of Port Harcourt refinery. So, if we percent, Al Arabiya reported, citing Snam’s below capacity, resulting in erratic fuel
have functional refineries, there are other CEO. supplies across Africa’s second largest copper
companies that will spring up. Snam is planning to use the investment and cobalt producer. Zambia plans to end
When you add the aggregate jobs that will to enter the region with an industrial asset, refining at the troubled Indeni plant before the
be created, it will be high. If you also look as well as to sell and promote the firm’s end of the year.
at the contribution to our national Gross technologies capable of catering to a future of Zambia supplies the bulk of its imported
Domestic Product, GDP, it is going to be hydrogen, the CEO disclosed. fuel to its vast copper and cobalt mines,
massive as well. The energy firm is planning on having a located near the northern border with Congo.
So, it is good for us to refine beyond what parallel system of hydrocarbons and hydrogen The country’s copper production dropped
the pump price of PMS is. running in parallel for many decades toc 5% last year to 800,000 metric tons as miners
On the issues of the refineries, one of the come, he revealed. suffered operational disruptions. Cobalt
things that we did from the side of the Trade This system offers a seamless way to shift output also slumped 22% to 247 tons.
Unions, PENGASSAN and Nigeria Union from fossil energy to complete renewable Musokotwane noted that high fuel prices
of Petroleum and Natural Gas Workers, energy, the CEO stressed. will pose challenges to Zambia’s ability to meet
NUPENG, was to be part of the steering Snam is currently very active in Saudi growth targets this year, despite the recovery
committee. Arabia through the investment of providing registered in 2021, after a contraction of 2.8%
We insisted that we should be on the electrolyzers to NEOM city, he added. in 2020.
Steering committee for us to have an idea Saudi Arabia, the UAE, and the Gulf WSJ

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