Page 10 - DMEA Week 17 2021
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DMEA REFINING DMEA
State refineries pass depressing milestone
AFRICA NIGERIA’S state-owned refineries have now through direct sale direct purchase (DSDP)
reached 19 consecutive months without process- deals, up from 1.58bn litres in December 2020.
ing any crude, according to the latest data pub- NNPC’s DSDP scheme provides for the allo-
lished by owner and operator Nigerian National cation of the state oil firm’s oil production to cer-
Petroleum Corp. (NNPC). tain overseas refiners and traders as well as local
During the period of July 2019 until January firms in exchange for petrol and other refined
2021, the four state-owned facilities – two at Port petroleum products of the same value.
Harcourt, one at Warri and one at Kaduna – have In March, Nigerian Minister of State for
had a utilisation rate of 0%, costing NNPC more Petroleum Resources Timipre Sylva announced
than $460mn. that the government would invest $1.5bn to
The news gives more weight to concerns rehabilitate the Port Harcourt complex, adding
about NNPC’s capabilities as a refinery operator. that Italy’s Maire Tecnimont would carry out the
Meanwhile, with work yet to begin to rehabilitate work.
the units to their combined throughput capacity The minister added that Maire Tecnimont
of 445,000 barrels per day (bpd) and the compa- would execute the work in three phases, with the
ny’s claims that reduced operations are “attrib- first phase to bring the unit back to 90% name-
uted to the ongoing revamping of the refineries”, plate capacity within 18 months, the second to be
there is scope for further scrutiny. completed within 24 months and the final stage
The Port Harcourt complex is comprised of within 44 months.
two units, built roughly 25 years apart, with joint The Italian firm was awarded a contract in
total capacity of 210,000 bpd, making it Nige- March 2019 for a two-phase programme with
ria’s largest refinery, while Kaduna and Warri fellow Italian firm Eni contracted as technical
have capacities of 110,000 bpd and 125,000 bpd adviser. The roughly $50mn first stage included
respectively. a six-month ‘integrity check’ and equipment
Meanwhile, in the six months prior to July inspection at the site, as well as ‘relevant engi-
2019, utilisation at the refineries was reported neering and planning activities’.
to be running at around 5.55%, though Kaduna NNPC agreed a loan of around $1bn with
only processed crude during June. Port Harcourt lenders led by Cairo-based African Export-Im-
operated during February and March, while port Bank (Afreximbank) in February. Sylva
Warri was utilised during the first four months noted that once the rehabilitation had been
of the year. completed, a “professional operations and main-
With the refineries out of service, in January tenance company [will be hired] to maintain the
this year, the latest month for which NNPC has refinery … this is one of the conditions of the
provided data, Nigeria imported 1.68bn litres lenders”. He added: “That’s embedded in discus-
of petrol (also known as premium motor spirit) sions with the lenders.”
P10 www. NEWSBASE .com Week 17 29•April•2021
