The planned construction of the
much-awaited three Greenfield refineries in Lagos, Bayelsa and Kogi
scheduled to commence in July this year may no longer be feasible.
A source at the Petroleum Ministry hinted that the project partners-
the Nigerian National Petroleum Corporation (NNPC) and the China State
Construction Engineering Corporation (CSCEC) Limited were yet to reach
an accord on the issue of funding.
The project had been envisaged to add 750,000 barrels per day of extra
refining capacity to Nigeria’s current 445,000 barrel per day refining
capacity and stem the flood of importation of refined products into the
country.
The delay in the take-off of the project, the source said was a major
setback to Nigeria’s plan to increase local refining to 95 per cent.
He said given the current dilapidated state of the existing refineries,
Nigeria would continue to do massive importation of petrol as the
Greenfield refineries could no longer come on stream in 2015 as earlier
planned.
He said the only way out was to privatise the refineries, pointing out
that series of Turnaround Maintenance (TAM), which cost millions of
dollars did not produce any result.
The parties had about two years ago, signed an agreement for the joint
sourcing of funds for the construction of the three new Greenfield
refineries and a petrochemical plant in Nigeria under a $28.5 billion
provisional deal.
The initial plan was that each of the new refineries would be able to
process around 250,000 barrels of oil a day, potentially meeting
Nigeria’s estimated need of 750,000 barrels per day over the next 10
years.
It was however gathered that the capacities on the plants to be built
in Lagos, Brass in Bayelsa and Lokoja, the Kogi State capital were
downsized.
Consequently, the Kogi and Bayelsa plants will now have the capacity
for 100,000 barrels per day (bpd) capacity each, while the one to be
located in Lekki, Lagos will have the capacity for 200,000bpd of crude.
An update on the project published recently revealed that
the decision to downsize the capacities of the plants was based on the
new Detailed Feasibility Study (DFS)prepared by Wood Mackenzie &
Foster Will.
It also showed that the ICBC of China was to provide 80 percent out of
the $11.3 billion now budgeted for the project, while the NNPC will
provide 20 per cent equity, to be diluted for private sector
participation later.
The Front End Engineering and Design (FEED), site preparation and
infrastructure had been scheduled to start in February 2012, while
construction will start in July of same year to be completion is 2015.
Source: www.thisdaylive.com
