That Kyari’s promise on PH Refinery – The Tide

The Nigerian government has announced that the Port Harcourt Refining Company (PHRC) would soon start operations after missing several previously set deadlines. In a recent meeting with the Senate, the Group Chief Executive Officer of the Nigeria National Petroleum Company Limited (NNPCL), Mele Kyari, assured Nigerians that the refinery would begin operations in two weeks. He emphasised a commitment to meeting the set deadlines for the PHRC and other refineries.

A statement by the NNPCL spokesperson, Olufemi Soneye, quoted Kyari as saying: “We will make sure that promises that we made about the rehabilitation of these refineries are kept. We completed the mechanical completion of PHRC in December. Now, we have crude oil already stocked in it. It is currently undergoing regulatory compliance test before we restream it. I assure you that this refinery will start in the next two weeks”.

Speaking further, Kyari declares: “For Warri, we have also done mechanical work on it. It is undergoing regulatory compliance processes that we are doing with our regulators. Kaduna will be ready by December this year, but we have not reached that stage. We believe that it will also be ready on schedule.” He explained that the PHRC had received 450,000 barrels of crude for processing since the mechanical completion of the plant in December last year.

In 2021, the Federal Government gave approval to allocate $1.5 billion for the purpose of repairing the refinery. Subsequently, an Italian company, named Maire Tecnimont, was selected to undertake the repair work, which would be carried out in three separate phases. The main goal of the first phase is to restore the refinery’s operation to 90 per cent capacity within 18 months.

Although the project faces numerous delays and obstacles, it is a critical measure to increase Nigeria’s ability to refine its petroleum products and decrease its reliance on imports. The original deadline of 2022 was not met. During this year’s budget defence session, Kyari informed lawmakers that the PHRC would start operations by the end of December. However, that deadline was also missed. Another target of January 1, 2024, also failed.

There were two previous instances of deadlines set by Ibe Kachikwu, who was the Minister of State (Petroleum Resources). There was another timeline under Timipre Sylva, and now we are faced with the current one. This would be the fifth or possibly even the sixth one. In the past, several government officials had made similar statements, but no tangible outcomes were achieved.

The four state-owned refineries, which are old and in bad condition, have a total capacity of 450,000 barrels per day. One of them, the Kaduna plant located in the North, has a capacity of 110,000 barrels per day, while the other three units are situated in the oil-rich Niger Delta region. One of these is the Warri refinery, with a capacity of 125,000 barrels per day. All four refineries have been closed for several years.

In 2019, the four local refineries completely ceased operations, leading to fuel supply issues in the country. The Port Harcourt refinery has the ability to produce 60,000 barrels per day at full capacity. If fully utilised, this could result in the production of approximately 10.1 million litres of petrol, which is roughly equivalent to one-third of Nigeria’s estimated daily consumption.

The Dangote refinery was expected to begin producing products by the end of July last year, while the commissioning date for the PHRC continues to be delayed. This impediment is worrisome as it means that Nigeria’s dependence on imported fuel will persist, potentially adding N33.3 billion to consumers’ pump prices due to freight costs. The completion of these refineries is essential for reducing importation and ensuring a more stable and affordable fuel supply for the country.

In general, we should be feeling joyful about Kyari’s promise. However, that is not the situation. If anything, we are extremely angry about the news. What should have been happy news has instead provoked the frustration in us, clearly because similar promises had been made in the past without any palpable outcome. It has become predictable to hear about the functioning of the refineries, whether in Port Harcourt, Warri or Kaduna. We hope that the GMD will fulfil his promise this time.

Since 2015, when the ruling All Progressives Congress (APC) took power from the Peoples Democratic Party (PDP), which had been in government for 16 years, there have been promises to maintain and eventually operate the PHRC and others, but none of these promises have been fulfilled. So, when the NNPC released a statement declaring that the government was determined to stop importing fuel and that the PHRC would start operations in two weeks, indicating the government’s readiness to end fuel importation, we are sceptical of this claim.

We strongly advise the National Assembly (NASS) to increase its efforts in pressuring the NNPCL management to fulfil its pledge of making the PHRC operational at the stipulated time by regularly monitoring its activities. If the NASS had performed its oversight function commendably, the state-owned refineries would not have been a heavy burden on public funds, preventing Nigerians from experiencing the benefits of being an oil-producing nation. If the refinery does not function as promised, Kyari should face severe sanctions.

Considering the Nigerian government’s history of making unfulfilled undertakings, it is understandable that we are hesitant to believe Kyari’s statement. Previous assurances have been broken, so it is hard to trust that this one will be any different. However, there is still some optimism that things will change this time and that the government will actually follow through on their promises. If the Tinubu administration must regain our trust and that of Nigerians, they have to demonstrate their sincerity and commitment to their obligations.

Opr/The Tide News Online