Oil & Energy

FG Plans Total Rehabilitation Of Refineries

Published

13 years ago

September 3, 2012

In a bid to bring back the nation’s refineries close to what
it was at inception, the federal government has given full support to the total rehabilitation of the
plants by the original refinery builders (ORBs).

The Group Executive Director, Refining and Petrochemicals,
Nigeria National Petroleum Corporation (NNPC), Engr Tony Ogbuigwe made the
disclosure while presenting a lead paper titled “Sustainable Refinery
Turnaround Maintenance” at the just concluded first International Conference on
Petroleum Refining and Petrochemicals in Port Harcourt last week.

Engr. Ogbuigwe explained that under best practices index, a
refinery was expected to run for 24 hours a week for two years and thereafter
undergo a turnaround maintenance.

He noted that “the industry best practice interval for
refineries turnaround is between 2 to 4 years depending on the complexities of
the plant. Best Practice index for capacity utilization is above 90 per cent on
continuous basis. You will agree with me that the current state of our
refineries leave much to be desired.”

He added that turnaround maintenance in the strict sense of
the word would not solve the current problems of the nation’s refineries as the
last turnaround maintenance of the
Kaduna Refinery was 2008, Warri 2004 and Port Harcourt 2000.

This, he pointed out, has informed government’s decision to
carry out total rehabilitation which will be done by the original builders of
these refineries, adding that the Bureau of Public Procurement waiver has been
obtained for these ORBs.

He said that the companies include, “Tecnimont in
collaboration with Japan Gasoline Corporation (JGC) for Port Harcourt Refining
Company Limited (PHRC), Saipem for Warri Refinery and Petrochemicals Company
(WRPC) Limited, and Chiyoda in collaboration with Saipem for Kaduna Refinery
and Petrochemical (KRPC) Limited.”

On the Port Harcourt Refinery Company, he said technical and
commercial proposal has been submitted
by August 31, 2012 and evaluation followed while award takes place in October
2012.

According to him, TAM and Rehabilitation contractors move to
site in October 2011 to commence detailed planning and mobilisation of manpower
and heavy equipment which would continue for about three to four months.

In February 2013, he continued, the plant will be shut down
and handed over to contractor for TAM which will take 45 days and back to
operation by April 2013, as further rehabilitation project would follow
immediately.

He said, “a new active power supply via Gas Turbine by an
Independent Power Provider (IPP) has been concluded and a Power Purchase
Agreement signed on 6th August 2012. Supply will commence by March 2013 in time
to re-stream the Plant after TAM”.

He pointed out that when these efforts would have been
concluded for the three refineries, it would enable them run at 90 per cent and
daily production of Petroleum products would improve to 20.3million, 9.24
million and 15.36 million litres of premium Motor Spirit (Petrol) Kerosene and
Automotive Gas Oil (AGO), respectively.

Vivian-Peace Nwinaene

Oil & Energy

No Subsidy In Oil, Gas Sector — NMDPRA

Published

6 days ago

September 8, 2025

The Tide

The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has said there are no subsidies in the oil and gas sector as Nigeria operates a completely deregulated market.

The Director, Public Affairs Department, NMDPRA, George Ene-Italy, made this known in an interview with newsmen, in Abuja, at the Weekend.

Reacting to the recent reports that the Federal Government has removed subsidies or increased the price of Compressed Natural Gas (CBG), Ene-Italy said, “What we have is a baseline price for our gas resources, including CNG as dictated by the Petroleum Industry Act”.

He insisted that as long as the prevailing CNG market price conforms to the baseline, then the pricing is legitimate.

Furthermore, the Presidential – Compressed Natural Gas Initiative (P-CNGI) had said that no directive or policy had been issued by the Federal Government to alter CNG pump prices.

The P-CNGI boss, Michael Oluwagbemi, emphasised that the recent pump price adjustments announced by certain operators were purely private-sector decisions and not the outcome of any government directive or policy.

For absolute clarity, it said that while pricing matters fell under the purview of the appropriate regulatory agencies, no directive or policy had been issued by the Federal Government to alter CNG pump prices.

The P-CNGI said its mandate, as directed by President Bola Tinubu, was to catalyse the development of the CNG mobility market and ensure the adoption of a cheaper, cleaner, and more sustainable alternative fuel and diesel nationwide.

Oil & Energy

‘Nigeria’s GDP’ll Hit $357bn, If Power Supply Gets To 8,000MW’

Published

6 days ago

September 8, 2025

The Tide

The Managing Director, Financial Derivatives Company Limited (FDC), Bismarck Rewane, has said that Nigeria’s Gross Domestic Product (GDP) could rise to $357b if electricity supply would increase from the present 4.500MW to 8,000MW.

Rewane also noted that Nigeria has spent not less than $30 billion in the power sector in 26 years only to increase the country’s power generation by mere 500MW, from 4,500 MW in 1999 to 5,000MW in 2025 though the sector has installed capacity to generate 13,000 MW.

In his presentation at the Lagos Business School (LBS) Executive Breakfast Session, titled “Nigeria Bailout or Lights Out: The Power Sector in a Free Fall”, Rewane insisted that the way out for the power sector that has N4.3 trillion indebtedness to banks would be either a bailout or lights out for Nigeria with its attendant consequences.

He said, “According to the World Bank, a 1.0 per cent increase in electricity consumption is associated with a 0.5 to 0.6 per cent rise in GDP.

“If power supply rises to 8000MW, from current 4500MW, the bailout shifts money from government into investment, raising consumption and productivity. And, due to multiplier effects, GDP could rise to $357 billion.”

The FDC’s Chief Executive said “in the last 30 years, Nigeria has invested not less than $30 billon to solve an intractable power supply problem.

“The initiatives, which started in 1999 when the power generated from the grid was as low as 4,500MW, have proved to be a failure at best.

“Twenty-six years later, and after five presidential administrations, the country is still generating 5,000MW. Nigeria is ranked as being in the lowest percentile of electricity per capita in the world.

“The way out is a bailout, or it is lights out for Nigeria”, he warned.

He traced the origin of the huge debts of the power sector to its privatisation under President Goodluck Jonathan’s administration, when many of the investors thought they had hit a jackpot, only to find out to their consternation that they had bought a poisoned chalice.

Rewane, who defined a bailout as “injection of money into a business or institution that would otherwise face an imminent collapse”, noted that the bailout may be injected as loans, subsidies, guarantees or equity for the purpose of stabilising markets, protect jobs and restore confidence.

He said, “The President has promised to consider a financial bailout for the Gencos and Discos. With a total indebtedness of N4.3 trillion to the banking system, the debt has shackled growth in the sector.”

Rewane warned that without implementing the bailouts for the power sector, the GENCOs and DISCOs would shut down at the risk of nationwide blackout.

Rewane, however, noted that implementing a bailout for the power sector could have a positive effect on the country’s economy if Nigeria’s actual power generation could rise from today’s 4,500 MW to around 8,000 and 10,000 MW.

The immediate gains, according to him, would include improved power generation and distribution capacity, more reliable electricity supply to homes and businesses as well as cost reflective tariffs.

Oil & Energy

NEITI Blames Oil, Gas Sector Theft On Mass Layoff

Published

6 days ago

September 8, 2025

The Tide

The Nigeria Extractive Industries Transparency Initiative (NEITI) has blamed the increasing crude oil theft across the nation on the persistent layoff of skilled workers in the oil and gas sector.

The Executive Secretary, NEITI, Orji Ogbonnaya Orji, stated this during an interview with newsmen in Abuja.

Orji said from investigations, many of the retrenched workers, who possess rare technical skills in pipeline management and welding, often turn to illicit networks that steal crude from pipelines and offshore facilities.

In his words, “You can’t steal oil without skill. The pipelines are sometimes deep underwater. Nigerians trained in welding and pipeline management get laid off, and when they are jobless, they become available to those who want to steal crude”.

He explained that oil theft requires extraordinary expertise and is not the work of “ordinary people in the creeks”, stressing that most of those involved were once trained by the same industry they now undermine.

According to him, many retrenched workers have formed consortia and offer their services to oil thieves, further complicating efforts to secure production facilities.

“This is why we told the Nigerian Content Development and Monitoring Board (NCDMB) to take this seriously. The laying off of skilled labour in oil and gas must stop”, he added.

While noting that oil theft has reduced in recent times due to tighter security coordination, Orji warned, however, that the failure to address its root causes, including unemployment among technically trained oil workers would continue to expose the country to losses.

According to him, between 2021 and 2023, Nigeria lost 687.65 million barrels of crude to theft, according to NEITI’s latest report. Orji said though theft dropped by 73 per cent in 2023, with 7.6 million barrels stolen compared to 36.6 million barrels in 2022, the figure still translates to billions of dollars in lost revenues.

Orji emphasised that beyond revenue, crude oil theft also undermines national security, as proceeds are used to finance terrorism and money laundering.

“It’s more expensive to keep losing crude than to build the kind of monitoring infrastructure Saudi Arabia has. Nigeria has what it takes to do the same”, he stated.