Fuel scarcity won’t end until refineries work – Marketers

The incessant reoccurrence of the scarcity of Premium Motor Spirit, popularly called petrol, is going to continue until the country starts refining petroleum products domestically and halts complete reliance on imports, oil marketers have said.

Nigeria imports its PMS and other refined crude oil products, as its refineries in Kaduna, Warri and Port Harcourt are not operating at the moment, after being dormant for several years.

Although work is currently ongoing at the facilities to revamp them, oil marketers say that the recurrence of fuel scarcity nationwide would come to a complete stop only when the country starts refining crude locally.

This, they said on Friday, was because the challenges association with the imports of refined petroleum products had been on the increase lately, particularly since the invasion of Ukraine by Russian forces in February last year.

The Nigerian National Petroleum Company Limited – the sole imported of petrol into Nigeria, has been grappling with the burden of subsidy on PMS, following the crash of the naira against the United States dollar and other fiscal challenges.

Oil marketers stated that PMS imports was not sustainable any more, going by the changes in the sector currently.

They insisted that the government must strive to commence in-country refining of products in order to ensure product availability and sustainability.

“The crux of the whole issue of petroleum product supply is the lack of refining capacity that we don’t have in the country,” the Deputy National President, Independent Petroleum Marketers Association of Nigeria, Zarma Mustapha, told our correspondent.

He added, “If we cannot be able to develop enough refining capacity in the country, this persistent on-and-off fuel scarcity situation will not end.”

The IPMAN official stated that he was aware that the government, through NNPC, was working on Nigeria’s refineries, but stressed that the pace had been so slow.

“I am happy with what the NNPC boss and the government is doing now to revive the Port Harcourt refinery, as the first step of the rehabilitation of our refineries, while the second phase is going to be the Warri and Kaduna refineries.

“But the concern we have is that the rate at which they are doing the repairs is too slow. They should hurry up the contractors to do their jobs fast. I also pray the Dangote Refinery starts production within the shortest possible time.

“This will help us reduce the extent of dependence on imported petroleum products. With that, it would address at least 70 per cent of the issues we are having with our refined petroleum products distribution.”

Efforts are ongoing to get Nigeria’s refineries functional.

On Thursday, NNPC and Daewoo Engineering and Construction Nigeria Limited, signed a contract of $740.67m (N341.48bn as at Thursday’s official exchange rate of N461.04/$) for the rehabilitation of Kaduna Refining and Petrochemical Company Limited.

Both parties signed the deal at the Abuja headquarters of NNPC, as the Executive Vice President, Downstream, of the oil national firm, Adeyemi Adetunji, said the exercise would take 21 months.

He said the quick-fix strategy would see to the repairs and re-streaming of KRPC, as well as ensure its operation on a sustainable basis at a minimum capacity utilisation of 60 per cent.

He said the contract marked a milestone in the history of KRPC, considering the fact that the last Turn Around Maintenance on the refinery occurred about 15 years ago, and that the project was framed after extensive engagement with Daewoo.

Adetunji also stated that the quick-fix strategy would guarantee the fastest route to re-streaming WRPC (Warri Refining and Petrochemical Company) and KRPC for in-country production of refined petroleum products.

“Restoring WRPC and KRPC back to operation will guarantee energy security for the country, reduce dependence on imported petroleum products in view of near total dependence on supply of imported petroleum products and the impact the ongoing Russia-Ukraine war is having on global supply,” he stated.

He further revealed that the rehabilitation of the Port Harcourt Refining Company had progressed considerably.

He said, “The old refinery is currently al 64 per cent completed and the plant is expected back in operation in Q2 2023, while the entre PHRC rehabilitation project currently stands at about 59 per cent.

“On the other hand, WRPC quick-fix project has achieved 28 per cent completion and is expected to be re-streamed by the end of this year.”

-punch news