Senate probes status of modular refineries

July 23rd, 2019

By Ignatius Okorocha

The Senate on Tuesday urged its Petroleum Committee on downstream and Upstream to invite the Ministry of Petroleum and the Nigerian National Petroleum Corporation (NNPC,)to brief it on the status of existing refineries including the status of newly licensed modular refineries in the country.

The decision followed a motion by Sen Rose Oko (PDP – Cross- River) on a motion entitled, Existing Petroleum Subsidy: Ensuring Self -Sufficiency in Domestic Refining of Petroleum Products.

The motion had 42 other senators as sponsors.

Speaking on the motion at plenary, Oko said although Nigeria produces 1.7million barrels of crude oil per day but its moribund refineries had very little refining capacity.

She said the nation imports roughly 90 per cent of its fuel ,negating much of the benefits accruing to oil producing nations from high crude prices.

She said despite the resources expended on turn around maintenance,none of the NNPC’s four refineries currently functions up to 50,per cent of their combined capacity of 445,000 barrels per day.

She said the objectives of modular refineries was to overcome the huge capital requirement that impedes establishment and maintenance of large scale refineries .

This ,she said would ensure self sufficiency in the production and supply of petroleum products.

She said data from the Department of Petroleum Resources(DPR) website had indicated that a total of 633,000 barrels per day refining capacity had already been lost due to the expiration of licenses of both conventional and modular refinery projects.

Oko, who also spoke on the fuel subsidy said more than 160 million dollars was spent on subsidy in early 2017.

She said Nigeria had introduced petroleum subsidy in the 1980s as a temple art measure to strengthen local refining industry and improve product affordability and domestic consumption.

She,however, said successive adminstrations had failed to make Nigeria self-sufficient in domestic production.

The senator said despite the dire need to exit petroleum importation and subsidy, there was neither a comprehensive plan to ensue its actualisation.

She said there was no form of technical and financial aid for refinery license holders to ensure the refineries become operational.

Senators who supported the motion include Sen. Barau Jibril,Thompson Sekibo,Ifeanyi Uba,and Ali Ndume among others.

The senators said there was an urgent need to ensure the optimal performance of the refineries.

They also called for grants to support the actualisation of the 43 modular refineries in the country.

The Senate in a voice vote urged the committee on petroleum downstream and upstream,when constituted to report back to the senate on the status of modula and existing refineries in eight weeks time.

In his remark President of the Senate,Dr Ahmad Lawan said the motion was designed to ensure that the 43 licensed modular refineries became operational.

He said there was the need to support them to become active.

He said the senate must make it a duty to ensure the establishment of the modular refineries.

He said the Petroleum Industry Bill (PIB) was also key the optimal utilisation of the refineries and emergence of the modular refineries.

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