Nigeria hopes the addition of 13 modular refineries will stop illegal crude refining

Nigeria’s state-owned oil firm Nigerian National Petroleum Corporation (NNPC) has approved the licence of 13 modular refineries of the 35 firms that expressed interest. This was made known by NNPC’s Managing Director, Maikanti Baru.

The modular refinery – a prefabricated processing plant that has been constructed on skid mounted surfaces, with each structure containing a portion of the entire refining process plant connected by interstitial piping to form an easily manageable process – is one Nigerian government’s ways to combat uprising in the southern part of the country (Niger Delta) where most of the West African country’s crude is located.

With the licencing of 13 modular refineries, Nigeria hopes illegal refining of crude will stop in the country. Also, these refineries will create employment and wealth among citizens, especially residents in the Niger Delta region of the country.

According to Baru, the country’s long dream of transforming from a net exporter of crude oil to a net exporter of petroleum products in no distant time transform into a reality as the government is committed to its December 2019 goal to end the importation of petroleum products into the country.

Assessment of companies interested in rehabilitating the refineries using a contractor-financing model has been completed and successful. Though the companies are yet to be announced, Baru stated that “The contractor-financing model is expected to be a self-sustaining financial model with near zero reliance on the federal government funds.” Adding that, for a smooth running and implementation, the government is changing the operating and commercial framework of the refineries to make them work efficiently and be commercially viable.”

Nigeria has an ongoing arrangement with the contractors to ensure that by 2019, the refineries would have reached at least 90 per cent capacity utilisation.