Nigeria: Modular Refineries Won't Provide Nigeria's Petrol Needs - Govt

11 September 2019

Abuja — The federal government has said it does not believe that modular refineries are the main solutions to Nigeria's inability to refine petroleum products locally, however, it said they would at best add to the solutions.

The government in this regard said it was focusing its efforts on making sure the country's refineries operated by the Nigerian National Petroleum Corporation (NNPC) in Kaduna, Warri and Port Harcourt are fully repaired and working efficiently.

President Muhammadu Buhari, who was reportedly represented by the Minister of State for Petroleum Resources, Mr. Timipreye Sylva, stated this while speaking at the ongoing 24th edition of the World Energy Congress (WEC) in Abu Dhabi, United Arab Emirates.

A statement from the Group General Manager, Public Affairs of the NNPC, Mr. Ndu Ughamadu, quoted Sylva to have also said that the federal government plans to sign off Final Investment Decisions (FIDs) on at least four key projects in the oil industry within the last quarter of 2019.

He said his vision was to bequeath a vibrant petroleum industry which would guarantee long term strategic investments and prosperity for Nigerians.

In 2018, the Department of Petroleum Resources (DPR) disclosed that it had so far granted licences for the establishment of modular refineries to 25 investors.

Also, during his tenure, the immediate-past Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, was a vocal supporter of modular refineries as part of the solutions to Nigeria's refining challenges.

Kachikwu had at the Biennial International Conference for Health, Safety and Environment (HSE) organised by DPR told participants that out of about 40 licences issued for modular refineries, only 10 have shown progress by submitting their programmes and putting something on the ground.

He added then that "by end of 2019, we are assured that three private modular refineries would be working."

However, at the WEC, Sylva said: "People are talking about modular refineries; we know that modular refineries are parts of the solution, but they can only be part of the solution and not the solutions themselves.

"So, we are going to try to encourage modular refineries, but before that, we are going to really focus on repairing the existing refineries to ensure that we are back on stream very shortly."

The minister also said: "My plan is to ensure that during my tenure, four Final Investment Decisions (FIDs) are taken. I am sure that within the next quarter, we should be able to conclude on some of these FIDs to grow the industry."

He noted that gas development was a priority for the government to fast-track the industrialisation of the country.

According to him, "As you are aware, we are focusing on the Ajaokuta-Kaduna-Kano (AKK) pipeline project which will address some of our power issues and encourage the setting up of local industries and businesses in different areas in Nigeria."

Sylva further spoke on the need to rehabilitate the refineries operated by the NNPC, saying it was unsustainable for Nigeria to continue to import petroleum products.

He added that while private investment in the refining sector would be encouraged, the government would focus more on the repair of its existing refineries.

The minister described theft of crude oil as an intractable issue and disclosed that the federal government was looking at practicable solutions to address it.

The government, he said, was also looking at reducing the cost of oil production through robust engagement with International Oil Companies (IOCs) in the country.

He explained that Nigeria needed to speak up and affirmatively at global energy fora as they remained some of the best platforms where major decisions that impact the global energy landscape are taken.

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