Page 11 - DMEA Week 50 2021

DMEA REFINING DMEA

NNPC discloses refining expenditure

AFRICA THE Nigerian National Petroleum Corp. Saipem and subsidiary Saipem Contracting
(NNPC) this week disclosed its operational worth a total of $1.485bn – $898mn for Warri
expenditure during the first 10 months of 2021, and $587mn for Kaduna – in August that entail
showing that it spent NGN83.33bn ($202mn) on a three-phase approach to rehabilitate the refin-
rehabilitating its refining facilities. eries over 77 months.
The first contracts were signed in April for Given NNPC’s patchy history of operating
the overhaul of the company’s currently defunct these state facilities, state investment in rehabil-
refining slate, which amounts to 445,000 barrels itating the refineries has been a thorny issue and
per day (bpd). Following years of operating at Minister of State, Petroleum Resources Timipre
near-zero utilisation, the four refineries – two at Sylva sought to quell the discontent about ongo-
Port Harcourt, one at Kaduna and one at Warri – ing spending, saying that NNPC had to continue
were taken offline completely in 2019. paying salaries despite not producing any fuel
NNPC has budgeted NGN100bn ($245mn) from the facilities.
for the full year and expenditure appears to be “We have a situation now of a refinery that
on track to utilise the full allocation. has not functioned for three years, yet it’s paying
The Nigerian government secured a $1bn salaries. Every [member of] staff is being paid.
loan from Cairo-based African Export-Import The refineries haven’t worked for three years. We
Bank (Afreximbank) in February and awarded a have carried on paying salaries. Nobody can sack
$1.5bn engineering, procurement and construc- anybody,” he said.
tion (EPC) contract to Italy’s Maire Tecnimont in The minister noted that the blame for the
April to return the Port Harcourt Refining Co. current situation should be shared among stake-
(PHRC) complex to 90% of its capacity by 2023. holders. “People are getting promoted, but the
The facility has a theoretical nameplate capac- refineries are not functioning. Unions will not
ity of 210,000 bpd, comprising a 60,000 bpd unit let you [fire anyone]. Those are the real issues. A
built in 1965, known as Area 5, and a newer few days ago, [NNPC managing director Mele
unit built in 1989 which is capable of processing Kyari] just threatened to lay off some contract
150,000 bpd of crude. The Italian company had staff in Kaduna refinery, which has not func-
carried out a 50mn, six-month ‘integrity check’ tioned for three years, and the unions wrote to
in 2019, with fellow Italian firm Eni contracted me that they heard that their members were to be
as technical adviser. This work included equip- sacked and gave threats.” He added: “The unions
ment inspection at the site, as well as “relevant and their members were the ones managing the
engineering and planning activities”. refineries. Yes, I know government is to blame.
NNPC’s facilities at Warri and Kaduna have I am not absolving government completely, but
capacities of 125,000 bpd and 110,000 bpd they themselves are part of the blame game. They
respectively. Contracts were awarded to Italy’s were managing it.”™

PETROCHEMICALS

Iran to produce own petchem catalysts by 2023

MIDDLE EAST IRAN will be fully self-reliant in producing cat- petrochemical catalysts annually, $200mn of
alysts used in the petrochemical industry by the which was domestically supplied.
Iranian calendar year of 1402 which begins in Domestic production of the catalysts pres-
March 2023, ently exported would save Iran $150mn-$180mn
On December 12 official energy news agency annually, according to NPC figures. After oil and
Shana quoted Majid Daftari, managing director gas, the petrochemical industry is recognised
of the country’s Petrochemical Research and as Iran’s most important, creating value-added
Technology Co. (PRTC) as saying that of the using oil- and gas-based feedstocks.
40 types of catalyst groups used by Iran’s petro- The country’s petrochemical capacity is
chemical industry, Iran already boasts the kno- expected to reach 130mn tonnes per year by
whow to produce 20. March 2026 with 50 projects anticipated being
“By the end of this [Persian calendar] year completed by the end of 1404 which begins in
[which falls on March 20, 2022], [the knowhow March 2025.
for producing] eight more groups will be indi- In August, Mohammadi also said that total
genised and the remaining 12 groups are being cumulative investment in the petrochemical sec-
researched or developed,” he added. tor will reach $125bn by 2027/28.
Former head of the National Petrochemical During 2020, Iran accounted for a 22.1%
Co. (NPC) Behzad Mohammadi previously share of Middle Eastern petrochemical trade,
said that the country needs $275mn worth of illustrating year-on-year growth of 2%.™

Week 50 16•December•2021 www. NEWSBASE .com P11