FUEL SUBSIDY: NNPCL To Take Major Decision On Refineries

Barring last-minute changes, the Nigerian National Petroleum Company Limited (NNPCL) would hand over the three refineries, currently undergoing rehabilitation, to a reputable third party with experience in operating and maintaining them, according to a source, who pleaded not to be named. He stated that the refineries were currently undergoing rehabilitation and are being managed as rehabilitation projects.

The Port Harcourt Refining Company Limited (PHRC) comprises two at AlesaEleme near Port Harcourt in Rivers State with a jetty (for product import and export). At inception, it had the capacity to process 150,000 barrels of crude per day but was later upgraded to 210,000 barrels per day. The Warri Refining and Petrochemical Company was built to process 100,000 barrels of crude oil per day but was later de-bottlenecked in 1987 to process 125,000 barrels per day.

The Kaduna refinery was designed for a capacity of 60,000 BPSD but later the Federal Government decided that the capacity of any refinery in Nigeria should not be below 100,000 BPSD. The administration of former President Muhammadu Buhari had awarded contracts for the rehabilitation of the refineries. After approval by the outgone Muhammadu Buhari-led Federal Executive Council, the NNPCL awarded the contracts for the rehabilitation of the Port Harcourt Refinery to Tecnimont SpA at $1.5 billion and the repairs of the Kaduna Refinery to Daewood at $741m, while $897,678,800 was budgeted for the Wari Refineries Some NNPCL inside sources also confirmed that NNPCL has collapsed some of its subsidiaries in a major shake-up aimed at cutting costs and boosting profitability. According to the sources, not less than six subsidiaries were affected.

According to them, NIDAS Shipping Services and Nikorma Shipping Services, which are the company’s global oil shipping firms, which were said to have been established in 2008 for LNG shipping and marine logistics, have been merged to become NNPC Shipping Company. Also, Integrated Data Services Limited, NNPC Oil Field Services, and Frontier Exploration Services have also been merged to become NNPC Energy Services Limited (EnSERV). Also, the former refining and petrochemical directorate was merged with the downstream, to align with an improved cost-effective structure.