The Guardian (Lagos)

6 August 2014

Nigeria: Govt to Scale Down U.S.$1.96 Billion Bitumen Import Bill

THE nation may conserve the $1.9 billion (N300 billion) foreign exchange being expended on the yearly importation of bitumen into the country, going by the current moves by the Federal Government to enhance local production.

The current moves, according to official sources, would be for the short-term, while efforts are being scripted to make the commodity join the import prohibition list.

The country's current reserve of bitumen has been assessed to be the second largest in the world after Venezuela, even as the commodity remains largely unexploited.

The Nigerian National Petroleum Corporation (NNPC) unfolded the local production enhancing agenda with strategic plans to gear up the Kaduna Refining and Petrochemical Company (KPRC) for optimum production of the product to save the nation the huge foreign exchange spent on the importation of the product.

The Group General Manager, Group Public Affairs, NNPC, Ohi Alegbe, in a reaction to a story attributed to the Association of Bitumen Marketers and Distributors published in some national dailies recently, disclosed that plans are currently on to repair the "Riser" at the heavy crude oil reception facility at Escravos.

When completed, this will guarantee the importation of heavy crude for the production of bitumen at the Kaduna Refinery, which is the only refinery configured to produce bitumen in the country.

The NNPC stressed that in the meantime, KRPC has about 5,005 metric tons of bitumen (also known as asphalt) for evacuation, and that a further 14,466 metric tons will be produced between now and September from available residue.

He explained that the KRPC has the capacity to produce 1,796 metric tons of asphalt per day or 592,680 metric tons per year of two major liquid and solid oxidized grades of bitumen while the current national demand is put at about 500,000 metric tons per year.

Alegbe assured that as soon as the "Riser" is repaired and the supply of heavy crude oil is guaranteed, there will be no need for further importation of bitumen.

Meanwhile, the corporation has ordered distributed power technologies to ensure a reliable energy supply and increase productivity at the Port Harcourt refinery.

The technology to be provided by GE includes three 25-megawatt (MW), trailer-mounted, TM2500+ aeroderivative gas turbines to generate uninterrupted power at the refinery

According to GE, the installation by GEL Utility Limited would ensure the country's largest oil refinery has the power it needs to overcome chronic grid outages and return to full capacity for refining.

Genesis Electricity Limited, an independent power producer and one of the owners of GEL Utility Limited, signed a 20-year power purchase agreement with NNPC in November 2013 for the installation of GE's TM2500+ units at the 49-year-old refinery.

The TM2500+ gas turbines will provide both the baseload and backup power to support refinery operations. The agreement also includes the future modernization of Nigeria's other two refineries.

The Chief Executive Officer of Genesis Electricity Limited, Akinwole Omoboriowo, said: "We are excited to work with GE to deploy their proven TM2500+ gas turbine technology and help Nigeria successfully return the Port Harcourt refinery to full service as quickly as possible. This project was not only important in getting the refinery back into full operation, but also to support Nigeria's long-term economic interests by achieving optimum refining capacity."

The three TM2500+ units will enter commercial operation in August 2014, giving PHRC the power it needs to return to full capacity. As a result, Nigeria will be able to drastically reduce its use of imported refined fuel products.

PresidenT of GE's Distributed Power business, Lorraine Bolsinger, said: "Our TM2500+ technology's high-power density and compact footprint make it the perfect solution to address Port Harcourt Refining Company's fast ramp-up, on-site power requirements while also ensuring the refinery's long-term viability,"

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