NNPC needs $500million to fix Nigeria's refineries

The combined output of the nation’s refineries has hit zero, as Port Harcourt refinery, which held the fort, has shut down.

Group Managing Director, Nigerian National Petroleum Corporation (NNPC), Dr. Ibe Kachikwu, disclosed this at a Luncheon of the Petroleum Club in Lagos, yesterday.

Kachikwu said with the shutdown of the Port Harcourt refinery, combined output in the last few weeks has dropped from 1.9 per cent to zero.

In its latest monthly report for September, the NNPC had stated: “Only Port Harcourt refinery produced 31,008 million metric tonnes of petroleum products out of 35,648 MT (261,371.14 barrels) of crude processed at an average capacity utilisation of 5.77 per cent.”

Kachikwu, who described the poor refining capacity as worrisome, however, said there are plans to restore the lost glory of the refineries and ensure they contribute massively to national fuel consumption.

He disclosed that the corporation would need about $500 million to fix the refineries and that he is determined to source the fund in the next seven months to one year. “Some people are sabotaging efforts through pipeline vandalism, but we will block all the leakages and fix the problem,” he added.

Decrying ongoing fuel scarcity, Kachikwu said the corporation is speeding up payment of subsidy claims, adding that plans are also in the pipeline to review the subsidy system and bring the amount down from N20 to about N5 per litre.

He said: “Products distribution is key to NNPC. We have, therefore, sent out about 5000 trucks to various locations across the country in the last two days.”

Kachikwu restated his commitment to turn around the NNPC to a world-class company within the next six to 12 months and ensure that it works efficiently in a transparent and accountable manner.

“We are out for transparency. We will be engaging the Presidency on a weekly basis, the governors monthly, and the National Assembly on a monthly basis, while we continue to publish our reports monthly,” he said.

The NNPC boss, who stressed that these are trying times for the industry, said the problems are more serious than people think, hence Nigerians must work hard.

He said the President is deeply worried about the prevailing situation in the industry and has given him the mandate to fix the problems, adding: “I will never do things that will compromise my integrity.”

Kachikwu said his administration has recovered $420 million from the legacy crude swap contract, increased gas supply to power plants at about 231 million standard cubic feet per day (mbpd) and planned to hit 240 mbpd next year.

“In 12 weeks at the NNPC, I have enhanced commercial value, increased productivity, increased profitability and improved governance at the corporation,” he stated.

Credit: TheGuardian