85% OF CRUDE MEANT FOR LOCAL REFINERIES EXPORTED IN 2014
Monday, 27 July 2015 04:01
Written by Hamisu Muhammad
Nigerian Daily Trust
The Nigerian National Petroleum Corporation (NNPC) has exported a total of 133.7 million barrels of crude oil (equivalent to 85.4 percent) meant for the three local refineries in 2014, data from the corporation has shown.
Only 22.8 million barrels or 14.6 percent of the total crude for the domestic refining was utilised by the refineries in Kaduna, Port Harcourt and Warri within the period.
The data obtained by Daily Trust showed that NNPC through its subsidiary, Pipeline and Product Marketing Company (PPMC), exported the crude under the crude exchange lifting (otherwise known as SWAP) arrangement totaling about 56.4 million barrels and offshore processing with about 21.1 million. The remaining 56.2 million barrels were regarded as unprocessed PPMC crude for the period.
Source in the oil industry told Daily Trust that some interest groups decided to ignore local refineries by channeling the crude oil under the crude for refined product SWAP arrangement.
The arrangement which in recent times generated a lot of controversy due to the scandalous nature under which it was run, had denied the refineries the little crude they needed to operate even below capacity.
“The combined average refining capacity utilisation for year 2014 was 14.4% as against 22% in 2013,” the NNPC report said.
The statistics showed that the local refineries received a total of 25,839,373.09 barrels (3,491,903mt) of (dry) crude oil, condensate and slops and processed 23,360,372.27 barrels (3,156,914mt) into various petroleum products. The total production output by the refineries was 2,665,289.09 metric tons of various petroleum products.
However industry source said the refineries were not completely dead as perceived by many. For instance, the major problem of the Port Harcourt refinery was power supply for some time but that the problem was fixed long ago.
The plan of the last regime, some observed, was to privatise the refineries possibly to its cronies as soon as it gets re-elected. Some of the equipment for the turnaround maintenance of the Port Harcourt and Kaduna refineries were abandoned at Onne Port for months. It was just recently, after the general elections, that the NNPC officials decided to pick them up. The idea was to keep the equipment after the privatisation and then use them to revive the refineries and begin production.
The source said with return of the refineries the amount spent on the subsidies and the foreign exchange spending will drop significantly.
Last Friday, the Governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, after the Monetary Policy Committee meeting in Abuja, announced that the Port Harcourt and Warri refineries have already commenced operations.
“Let me confirm that the CBN and the NNPC have held a couple of meetings and I am aware that Port-Harcourt and Warri have started refining petroleum products. We are expecting that in the month of August. Kaduna Refinery will begin refining petroleum products.
“Hopefully, as they ramp up production, they would be able to get to about 19 to 20 million litres that they can produce to meet our daily consumption level of about 30 million litres.
“Our interest as CBN is that by this act alone we are going to record a drastic reduction in the importation of petroleum products which will ultimately help our reserve position and help us in our mandate of strengthening the exchange rate,” he said.
But the General Manager, Public Affairs of the NNPC, Ohi Alegbe, recently attributed the slow operations of the refineries to the turnaround maintenance of the facilities going on.
“The refineries at Warri, Port Harcourt and Kaduna will resume next month (July) after a successful turnaround maintenance (overhaul) of their facilities,” Alegbe said last month.
Written by Hamisu Muhammad
Nigerian Daily Trust
The Nigerian National Petroleum Corporation (NNPC) has exported a total of 133.7 million barrels of crude oil (equivalent to 85.4 percent) meant for the three local refineries in 2014, data from the corporation has shown.
Only 22.8 million barrels or 14.6 percent of the total crude for the domestic refining was utilised by the refineries in Kaduna, Port Harcourt and Warri within the period.
The data obtained by Daily Trust showed that NNPC through its subsidiary, Pipeline and Product Marketing Company (PPMC), exported the crude under the crude exchange lifting (otherwise known as SWAP) arrangement totaling about 56.4 million barrels and offshore processing with about 21.1 million. The remaining 56.2 million barrels were regarded as unprocessed PPMC crude for the period.
Source in the oil industry told Daily Trust that some interest groups decided to ignore local refineries by channeling the crude oil under the crude for refined product SWAP arrangement.
The arrangement which in recent times generated a lot of controversy due to the scandalous nature under which it was run, had denied the refineries the little crude they needed to operate even below capacity.
“The combined average refining capacity utilisation for year 2014 was 14.4% as against 22% in 2013,” the NNPC report said.
The statistics showed that the local refineries received a total of 25,839,373.09 barrels (3,491,903mt) of (dry) crude oil, condensate and slops and processed 23,360,372.27 barrels (3,156,914mt) into various petroleum products. The total production output by the refineries was 2,665,289.09 metric tons of various petroleum products.
However industry source said the refineries were not completely dead as perceived by many. For instance, the major problem of the Port Harcourt refinery was power supply for some time but that the problem was fixed long ago.
The plan of the last regime, some observed, was to privatise the refineries possibly to its cronies as soon as it gets re-elected. Some of the equipment for the turnaround maintenance of the Port Harcourt and Kaduna refineries were abandoned at Onne Port for months. It was just recently, after the general elections, that the NNPC officials decided to pick them up. The idea was to keep the equipment after the privatisation and then use them to revive the refineries and begin production.
The source said with return of the refineries the amount spent on the subsidies and the foreign exchange spending will drop significantly.
Last Friday, the Governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, after the Monetary Policy Committee meeting in Abuja, announced that the Port Harcourt and Warri refineries have already commenced operations.
“Let me confirm that the CBN and the NNPC have held a couple of meetings and I am aware that Port-Harcourt and Warri have started refining petroleum products. We are expecting that in the month of August. Kaduna Refinery will begin refining petroleum products.
“Hopefully, as they ramp up production, they would be able to get to about 19 to 20 million litres that they can produce to meet our daily consumption level of about 30 million litres.
“Our interest as CBN is that by this act alone we are going to record a drastic reduction in the importation of petroleum products which will ultimately help our reserve position and help us in our mandate of strengthening the exchange rate,” he said.
But the General Manager, Public Affairs of the NNPC, Ohi Alegbe, recently attributed the slow operations of the refineries to the turnaround maintenance of the facilities going on.
“The refineries at Warri, Port Harcourt and Kaduna will resume next month (July) after a successful turnaround maintenance (overhaul) of their facilities,” Alegbe said last month.
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