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PH Refinery Ends 2020 In Operating Losses Spends N19.215bn Admin Cost, N22.55bn On Salaries, Others

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The Port Harcourt Refinery Company (PHRC) has ended the 2020 financial year with huge operating losses while amassing colossal expenses in administrative overheads and salaries and allowances of staff, without generating a dime.
The local refinery, which is managed by Ahmed Dikko, an engineer, reported no income in 2020 but incurred administrative expenses of N19.215billion while spending N22.55billion of payment of salaries, wages and other benefits to unproductive workers.
These revelations were contained in the current Nigerian National Petroleum Corporation (NNPC) Financial Report.
Worse still, the refinery, which is one of the subsidiaries of the Nigerian National Petroleum Corporation (NNPC) managed by Mele Kyari, employed average of 487 new staff members in 2020.
To show the high level of financial recklessness going on at the mismanaged refinery, the 487 new workers are being paid N3.93billion annually, indicating that each of them takes an average of N8.072million annually or N672,713 monthly.
The amount they earn monthly is about the annual salary of a normal Level 8 Federal Government worker.
Between 2019 and 2020, the refinery employed 1,162 new staff, paying N41.163billion in salary and wages, according to experts’ calculations of the company’s wage data on its financial statements.
Out of the 487 staff members employed in 2020, 430 were senior and management staff, amounting to 88.2 per cent, with huge financial implications.
Only 57 were junior staff members.
Also, out of 675 staff engaged by the refinery in 2019, 656 were management and senior staff, representing 97 per cent of the total, with huge financial implications.
“It is looking like jobs for the boys at our dear refineries. And I wonder, most of these guys are earning heavy wages,” US-based Financial Consultant, Ellam Ogochukwu said.
“Whoever is running that enterprise deserves to answer several questions,” she said.
Also, staff pension, gratuity and ‘long service award’ gulped N77.76billion in 2020 as against N63.41billion the previous year.
Surprisingly, under Dikko and Kyari, the PHRC’s unproductive staff were allowed to take car loans, compassionate loans and advances valued at N1.001billion in 2020.
The amount was N597.297million in 2019.
In 2020, this refinery, which made no revenue, incurred a comprehensive loss of N53.179billion.
In the previous year, the company made no revenue but incurred N50.530billion in comprehensive loss.
Between 2017 and 2020, the company comprehensively lost N241.609billion.
Its revenue within this period was merely N6.27billion.
“This refinery did not produce oil. What you have is that some people just iron their clothes, go to work and come back at the end of the day without adding to the productivity of the company,” Oil and Gas Analyst at Lagos-based Chapel Hill Denham, Mustapha Wahab said.
The NNPC Managing Director, Mele Kyari, is the chairman of Port Harcourt Refinery.
He is followed by Ahmed Dikko (MD); Babatunde Sofowora (Executive Director of Services); Reginald Udeh (Executive Director, Finance and Accounts); James Ifeanyichukwu Ajibo (Executive Director, Operations); and Awaisu Muazu (late, served till July, 2020).
These directors took N99.742million as emoluments in 2020, a 67 per cent increase from N59.650million they took in 2019.
In 2019, the Port Harcourt Refinery did not record any revenue.
Yet, it reported N25.19billion in expenses.
Six directors collected N59.65million in fees, meaning that each of them received an average payment of N9.94million a month in 2019.
According to the NNPC, names of the six directors in 2019 were: Group Managing Director of NNPC, Malam Mele Kyari; Managing Director Abba Bukar (who retired in March, 2020); Executive Director of Services, Babatunde S. Sofowore; Executive Director of Operations, Ganiyu Abiodun Owolabi; another Executive Director of Operations, Engr Abel N. Imonighavwe; and Executive Director of Finance and Accounts, Mrs Aramide M. Ekundayo.
Salaries, wages, allowances, redundancy and pension costs gulped N22.195billion.
What that means is that, on the average, each staff member received N32.88million in 2019 from a company that made no revenue.
This amounts, on the average, to N2.74million each month.
Total salaries and pays received by staff of Port Harcourt Refinery between 2017 and 2019 amounted at N80.57billion.
But revenues received by the company within the period were estimated at N6.27billion – implying that the NNPC sought N74.3billion from outside the refinery to pay staff salaries.
Rather than privatise the refinery, the NNPC chose to pump an equivalent of 4.5 per cent of Nigeria’s 2021 budget ($1.5billion) into the refurbishment of a refinery that comprehensively lost N206.069billion between 2017 and 2020.
Wahab said that the investment in the refinery made no sense.
“Dangote Refinery is coming on board and can process about 650,000 barrels per day of crude oil – highest in the world. NNPC has taken 20 per cent stake in Dangote.
“Why then are you resuscitating Port Harcourt Refinery? We have done the analysis at Chapel Hill Denham and found that government should be spending $3billion or more to ensure efficiency of the refinery. So, it does not make investment sense because you are not going to compete with yourself,” he said.
“Two, some countries are exiting low-carbon energy sources and migrating to clean energy. So, after rehabilitating Port Harcourt Refinery, for how long will you enjoy its benefits, given that your market is not just Nigeria but also those countries exiting what you intend to sell to them?”, he asked, urging the Federal Government to concession it for optimal benefits to the Nigerian economy.
Also, Oil and Gas Governance Consultant, Henry Ademola Adigun, said that the refinery was badly managed.
“The point is that the refineries are still badly managed. The faster the corporation becomes a limited liability company, the better,” Adigun said.
“You have a refinery not producing anything and not making revenues but salaries are being paid. How did the NNPC make the profit they said they made when the inefficiencies are there? The profit and loss do not show anything. They simply want to make it attractive to the stockman.”
He said there was no cost-cutting by the NNPC or the refineries, adding that there were also “no innovative efficiency, no restructuring or replanting and no cost-saving on salaries and wages.”
Former President of the Nigerian Society of Petroleum Engineers, Joe Nwakwue, said that the only thing that the corporation could have done was to sell off the refineries.
“If you have a factory and is not producing, you will have to pay the gate man and the even the insurance company.”
The PHRC was commissioned in 1965.
It was made up of two refineries: the old refinery commissioned in 1965 with capacity of 60,000 barrels per stream day (bpsd) and the new refinery commissioned in 1989 with an installed capacity of 150,000bpsd, according to the NNPC.
It has a capacity of 210,000bpsd with five process areas.
In 2000, the then government of Nigeria shut down the refinery for turnaround maintenance.
Other three refineries in the country were also expected to undergo a similar process, Oil & Gas Journal said.
As of that time, $364million had already been spent on endless turnaround maintenance (TAM) services.
About $25billion has been spent on turnaround maintenance in the past 25 years.
The Institute for Global Energy Research, in a 2004 article, said the barrage of corruption, poor management, sabotage and lack of the mandatory turnaround maintenance (TAM) every two years had made all the refineries inefficient, making them operate at about 40 per cent of full capacity.
The NNPC said in April, 2020, that it would hand over the four refineries in the country to a private firm to manage.
“We are going to get an O&M contract; NNPC won’t run it. We are going to get a firm that will guarantee that this plant would run for some time. We want to try a different model of getting this refinery to run. And we are going to apply this process for the running of the other two refineries.”
However, this has not happened.
Rather, the corporation has sought money to rehabilitate the failed refineries.
It has prided itself on cost-cutting efficiency, but its refineries have incurred humongous losses.
Analysts say NNPC has no cause to hold onto the running of the refineries, having shown no capacity to manage it.

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We’ll Prioritise Health Sector In 2025 Budget, Fubara Assures WHO …Recommits To More Healthcare Access

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Rivers State Governor, Sir Siminalayi Fubara, has said that Rivers people deserve a functional healthcare system that will avail them easy access to reliable and affordable quality services to enable them to stay healthy always.
To achieve this goal, Governor Fubara reiterated the determination of his administration to commit huge budgetary allocation to the sector in the 2025 budget in order to give necessary financial support to drive the activities in the sector.
This, he noted, will further strengthen what is being done already in ensuring that healthcare facilities in the State are functional at the primary, secondary and tertiary levels to achieve universal access for the people.
Governor Fubara give the assurance when he received in audience a delegation of the World Health Organisation (WHO), led by the Country Representative, Dr Kazadi Walter Molumbo, at Government House in Port Harcourt, yesterday.
The Governor said: “As a matter of fact, in our 2025 budget, we have three key areas: Health, Education and Agriculture. They are our key areas in our 2025 budget. We believe that when we roll out that budget, greater part of the health issues and services will be accommodated.”
Governor Fubara recalled the disheartening state of health facilities his administration inherited, as there were no functional intermediary health facilities given the fact that all the zonal hospitals were not completed.
Saying that the situation was unacceptable, Governor Fubara said, “I know quite alright that one of the most important things, if we go by the Sustainable Development Goals (SDGs) agenda: affordable healthcare is one major thing that is key target, and it is something the World Health Organization (WHO) is working to make sure that it shouldn’t just be an item for the privileged, but even the less-privileged in the society should afford it and fast too.
“So, as a government, when we came on board, we also knew that one very important area that we need to touch is the healthcare. Development cannot be complete if the health sector is abandoned. So, we did all we could within our power to make sure that we revitalize that area.
“And some of the achievements like the Health Insurance Scheme that has been there for long before now, that we have activated. We might not have gotten it right completely, but the most important thing is that we have started it. Rivers State has keyed into it.”
Governor Fubara insisted: “The very active state of our primary healthcare system now is better than when we came on board. Whatever it is that is required; their resources, we don’t even tamper with it.
“We ensured that they get their resources as at when due so that the aspect of their control and administrative duties are discharged. Accordingly, the primary healthcare system has improved compared to what it was before we came on board.
“We did not end there. We know the situation of the tertiary health services. We only have two: Rivers State University Teaching Hospital (RSUTH) and University of Port Harcourt Teaching Hospital (UPTH). You can imagine the pressure on those two. So, we also took it upon ourselves to make sure that the intermediary health services must come to life.
“As a policy of our government, we have even started the completion and expansion to standard of all the Zonal Hospitals. We have the Degema, Bori, Ahoada, Omoku and Okehi, and we are already working on them. We didn’t end there. We also have a key facility in Bonny.
“People living in Bonny can’t come from there to access the Zonal Hospital. So, we have already started work to improve the state of the Bonny General Hospital. We know the importance of health, and we are doing our best to complement what WHO is also doing to make sure that healthcare gets to not just the rich, but the poor at affordable rate, with quality service.
Governor Fubara appreciated WHO for the wonderful work that it is doing in both supervisory and support role in the health sector and other areas of health concerns, not just in Rivers State, but in Nigeria and the world at large.
The Governor pointed out that everything is being done to sufficiently provide needed preventive and intervention measures against cholera and all related communicable diseases.
Governor Fubara said: “I have already directed the Commissioner for Health to commence all the necessary processes needed to checkmate the situation. We honestly prioritise health issues. We don’t joke with it.
“We have already started whatever it is, not just the issue of cholera. We are even talking about the issues that could arise from the anticipated flood situation in the state.
“We have also set up a medical team, knowing fully well that, definitely, there will be health issues when the flood situation breaks out. So, we are on top of the situation.”
In his presentation, the Country Representative of World Health Organisation (WHO), Dr Kazadi Walter Molumbo, commended Governor Fubara for his efforts and political will towards the various healthcare interventions in a bid to achieve the target for Sustainable Development Goals (SDGs) and ensure that the people enjoy good health and well-being by 2030.
Dr. Molumbo stated that Nigeria, like most countries of the world, was lagging behind in terms of reaching the target for SDGs by 2030, adding that it was for that reason that there is a global call to do things differently and accelerate the rescue of the people.
He, however, noted: “But, something is very encouraging in your administration, and I will like to commend the effort of your government in providing the enabling environment for all stakeholders in the health sector.
“We also noted your commitment towards improving primary healthcare services and the revitalisation and drive to improve the health status of the good people of Rivers State.
“I will like to specifically commend you for some of the key achievements that have come to our notice, namely: the reactivation of the task force on primary healthcare in line with the Abuja Declaration, and again, I like to emphasize the need for other departments to participate towards efforts to reach that reactivation.
“The consistent release of counterpart funds for supplementary immunization activities. This is something we like to see in many states. What is happening in Rivers State is truly encouraging,” he said.
He commended the Governor for his determination to complete and upgrade the zonal hospitals, strengthen primary healthcare services, and support other efforts to improve the quality of life of Rivers people.

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Tinubu Consults Labour, Defers Decision On New Minimum Wage

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President Bola Tinubu yesterday held consultations with the organised labour in furtherance of his engagements with critical stakeholders toward arriving at a new national minimum wage.
Minister of State, Labour and Employment, Nkeiruka Onyejeocha, disclosed this while briefing State House correspondents at the end of the meeting yesterday in Abuja.
Onyejeocha said, “The meeting was a conversation between a father and his children, and not a negotiation on the new national minimum wage.”
Also speaking, President of the Nigeria Labour Congress (NLC), Mr Joe Ajaero, said there was no discussion in terms of what the new national minimum wage would be, and that the status quo remained.
“We didn’t discuss figures.
“The status quo remains, the Federal Government stands on N62,000 while labour is sticking to N250,000.
“We will be back after one week to continue the discussion,” Ajaero said.
President-General of the Trade Union Congress of Nigeria (TUC), Mr Festus Osifo, also said labour presented the issues bothering Nigerians to the President as part of his consultations toward arriving at a new minimum wage.
Osifo said the meeting was an opportunity for labour to let the President know how the economic difficulties and the value of the Naira have affected the prices of goods in the market.
“We are all aware of what is happening in the country, how the high cost of living has impacted the ordinary Nigerians and workers.
“So, it was necessary to let the President know the exact situation of things in the country,” Osifo said.

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We’ve Started Preparing Our 2025 Budget -Fubara …Says Amaewhule, 24 Others’ Seats Were Declared Vacant On Dec 13

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Rivers State Governor, Sir Siminalayi Fubara, has said that his administration has started the process of preparing the 2025 budget, just as he insisted that the legislative seats of Martin Amaewhule and his co-travellers that were declared vacant on December 13, 2023, will remain so.
The Governor stated that they are truly gone and will eventually return home because they desired it to be so when they defected from the Peoples Democratic Party (PDP), the platform on which they won their election, to the All Progressives Congress (APC), voluntarily.
Governor Fubara spoke when he received on solidarity visit the leadership structure, critical stakeholders, opinion leaders, women and youths of Etche and Omuma Local Government Areas led by Ogbakor Etche, the apex socio-cultural organisation of Etche Ethnic Nationality Worldwide, at Government House in Port Harcourt on Wednesday.
The Governor, who dismissed their recent ranting as noise-making from delusional folks, urged the 25 former lawmakers to wake up from their slumber to see the ship of governance in the State sailing on smoothly.
Governor Fubara also said that his administration has started preparing details of the 2025 Appropriation Bill, with priority placed on education, healthcare and agriculture.
He said, “Let me assure you that agriculture is an area that we have promised the very special and peace-loving people of Rivers State that our 2025 budget, which we have already started preparing, will address. Don’t bother about those people that are delusional. They think we are still sleeping. Let me tell you people so that they can hear anywhere they are.
“I wanted to help them, sincerely because I know them. And I have said it before, these are people that I have helped. I paid their children’s school fees. I paid their house rents. So, I wanted to help them.
“We all knew what happened when they crossed (defected), and how did they cross? Because of our God, for them to make that mistake, they crossed! They are gone, and they are gone. Now, let me tell you: when I wanted to help them, I accepted to help them because we are all one. We disagree to agree as it is said.”
Governor Fubara stated: “But, they thought they are smart. What is holding them is the declaration of their seats vacant that was done on December 13, 2023. That is what is holding them. We are not doing any budget to nullify that decision. It is what will send them to their villages.
“For me, as I am talking to you, I have started preparing my budget for 2025, which I am going to present very soon. And, in that budget, my key areas will be education, healthcare and agriculture.”
Governor Fubara explained that the three priority areas that the 2025 budget will focus on will ensure that even if more roads will be constructed, emphasis will be placed on providing quality healthcare services to keep the people healthy.
“Our children need to go to quality schools. Even if they can’t go to private schools, let them go to the public ones that have standard. We need to go to good health facilities owned by government and get standard healthcare services.
“Even if we cannot afford those private hospitals, when you go to the public ones, you can get the same services with qualified professionals. That is our thinking.
“And when we get to the issue of agriculture, it will address the issue of unemployment. When we start engaging our youths, they wouldn’t have time to be involved in crime. So, our thinking is to secure and protect our State,” he added.
Governor Fubara reiterated that his administration is not fighting anybody, and will continue to show appreciation to those who have contributed to the good fortunes that he has received in life.
The Governor, however, clarified that in being loyal, it does not mean losing one’s liberty, sense of discretion, and what is right, which is why he will not be a Governor forced on his knees to stair the affairs of the State.
He added, “I want to assure you one thing: we are not fighting anybody. We appreciate what God has used people to also do in our lives. But, we are not going to rule (govern) this State on our bent knees. We will rule standing this way I am standing.
“If it is only being on our knees to rule that is the way that they will see us as being loyal, then, I will pack my few things that I have here, and go and relax in my house comfortably because it will be a disaster, not just to me but to everyone in thd State and even my own generation.
“So, I will continue to stand tall and stand on the side of truth. So, let me thank the President General (of Ogbakor Etche) for bringing your people, the great people of Etche and Omuma together to come and pay us a solidarity visit.
“We want to assure you that we recognize all ethnic groups, and we are not here because of any particular group. We are here and standing for Rivers State. Our greatest support has come, not from my own people (Opobo), but from all of you.”
Governor Fubara urged the people of Etche Nation to sustain their support for his administration because its vision is clear and encompassing to advance the well-being of all Rivers people.
The Governor said, as stated in the national anthem, he is determined to establish a climate (State) where every man should be free of oppression, and freely pursue their aspirations.
He emphasised: “We are asking for only one thing from you: Support us because our interest is very clear and straight. We mean well for our people. We want everyone to be free. We want to lead with the fear of God. We want you to express yourselves without fear.
“So, I want to assure you that we are on the right track. With your support, we are going to get there. Don’t allow anybody deceive you. They can go to the media and dance; when they go behind, they cry. It is the truth. We don’t know how to dance but we say it the way it is, and stand tall anywhere we go.”
Governor Fubara, in responding to the requests of the people, said his administration is working with the Nigeria Police in finding lasting solutions to the hydra-headed issue of herdsmen attacks on farmlands and farmers in the area while urging them to continue to provide vital information of strange people and their operations to the relevant authorities.
The Governor also promised to address the issue of illegal dredging activities in the area, and undertake reconstruction work on priority areas, including roads, schools and health facilities, just as he announced the donation of N50million to Ogbakor Etche Worldwide for the smooth running of the organisation.
In his speech, Oyeisi Etche, His Eminence, Eze Emmanuel Opurum, said Etche and Omuma people will continue to give full support to Governor Fubara and ensure that his administration succeeds.
Eze Opurum, who also said that the political crisis in Rivers State is an ill wind that will do no good to anybody, called on governors of the 36 States of the Federation to quickly summon a meeting to collectively find a lasting solution to the crisis, which should be communicated to President Bola Tinubu and eventually enforced.
On his part, the President General of Ogbakor Etche Worldwide, Sir Charles Nwonuala, said the Etche people, who share in the travails, joy and the many victories of Governor Fubara, came to pledge their unalloyed support, confidence and faith in him and his administration.
Sir Nwonuala also presented a list of roads, schools and other development needs plaguing them as a people, while insisting that they endorse and support the good governance provided by the Governor in the State.
In his speech, Head of Rivers State Civil Service, Dr George Nwaeke, said the Oyeisi Etche, the entire leadership structure plus 70 academic professors from Etche Nation, have come together with women and youths to express solidarity to Governor Fubara to enable his administration succeed.
Dr Nwaeke emphasised that they are particularly happy to identify with the administration because they rank among first who felt liberated when the administration of Governor Fubara started giving his all-inclusive leadership approach and love for peace.

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