The Nigerian National Petroleum Company Limited, NNPC, says it will end the importation of petroleum products by the middle of next year.
The Group’s Chief Executive Officer, Mele Kyari stated this on Tuesday in Abuja, at the weekly ministerial briefing organised by the Presidential Communications Team.
He said with the new measures being put in place, the company would meet the oil needs of Nigerians and even some countries of the world.
Kyari said: “Even if all our four refineries in three locations are at 90% of installed capacity, they will only be able to raise 18 million litres of petroleum motor spirit (PMS) or petrol. That means that even if all of them are working today, we will still have a net deficit of PMS imported to this country.
“This is what it means; because our population has grown, demand has grown and the middle class has grown, such that the volume of PMS required in this country has grown exponentially. Certainly if they all come back we will still need to do more and happily also, NNPC owns 20% equity in the Dangote Refinery and we are very proud of this.
“Not just that, we have the right of first refusal to supply crude oil to that plant because we saw this energy transition challenge coming. We knew that a time will come when you will look for people who will buy your crude oil, you will not find it. And that means that we have locked down the ability to sell crude oil for 300, 000 barrels minimum by right for the next 20 years.”
“Also, by right, we have access to 20% of the production from that plant as a part of our equity. So this refinery, when it comes on stream by the latest, the middle of next year. If it does, because it has the capacity to produce 650, 000 per barrel capacity and a different technology, it can crack the crude in a manner that you will have more gasoline than a typical refinery. That refinery has the ability to produce 50 million litres of PMS per day. So, a combination of that and our own ability to bring back our refineries will completely eliminate the importation of petroleum products into this country next year. You will not see any importation into this country next year. This is very practical, this is very possible,” Kyari stated.
On the resuscitation of the country’s refineries, the NNPC Chief Executive Officer revealed that work has reached an advanced stage.
He said; “Our refineries are not functioning. We deliberately shut them down because it didn’t make any sense for you to take in for example $100 oil into the refineries and the product it brings out is $70. This is because of many reasons that border on very many years of neglect that have crystallised into the inability of these plants to perform optimally.
“It is still lamentations. We are not absolving ourselves from that responsibility or liability. It is real. What is very obvious is that this company wasn’t operating as a business for some reasons. Overall we ended up having a situation where we were unable to make them process optimally and we shut them down. But now we are very confident that we are restoring them back to at least 90 percent of their installed capacities. We will get them back to normalcy and run them as a business.”
Vandalism
Kyari said that vandalism of pipelines remained the major challenge confronting oil production in Nigeria.
He said the government would not relent in fighting the vandals because they are sabotaging the nation’s economy.
The NNPC Boss further explaijed that a lot of people including churches, mosques, security agencies as well as communities where pipelines pass through are involved in the shoddy business.
He said: “As you may also be aware because of the very unfortunate acts of vandals along our major pipelines from Atlas Cove all the to Ibadan, and all others connecting all the 37 depots that we have across the country. You know, none of them can take delivery of products today.
“And the reason is very simple. For some of the lines, for instance, from Warri to Benin, we haven’t operated that line for 15 years. Every molecule of product that we put there gets lost. And of course you remember the sad incident of the fire incident very close to Warri, close to Sapele that killed so many people.
“So, we had to shut it down and as we speak, ladies and gentlemen, the level of losses that we have on our product pipeline, and I’m sure you may have seen it and I’ll invite you at the right time so we can take a look at it jointly.
“When a fire outbreak happened in one of our pipelines in Lagos State, we discovered that some of the pipelines were connected to individuals’ homes. And not only that, and with all sensitivity to our religious beliefs, some of the pipelines and some of the products that we found, are actually in churches and mosques.
“That means that everybody is involved. There is no way you will take products, bring in trucks in populated neighbourhoods, load them and leave without everybody else knowing about it. That everybody includes members of the community, members of the religious leadership, and also most likely, government officials of all natures, including security agencies personnel. They are everywhere,” he said.
On the decision to hire private contractors to man its oil pipeline network nationwide, Kyari argued that although the security agencies are doing their part, end-to-end pipeline surveillance would require the involvement of private entities and community stakeholders.
He said; “We need private contractors to man the right of way to these pipelines. So we put up a framework for contractors to come and bid and they were selected through a tender process. And we believe we made the right decision.”
Mercy Chukwudiebere
