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Monday, September 21, 2015

Finally on track? Nigeria’s oil refineries resume production

Workers rehabilitate the new Port Harcourt
Workers rehabilitate the new Port Harcourt refinery built in 1989 at the same site where the first refinery in Nigeria was built in 1965 in oil rich Port Harcourt, Rivers State, on September 16, 2015. The Port Harcourt refinery is Nigeria’s oldest, built in 1965, nine years after crude was first found under the marshy soil and creeks of the delta, where the Niger river meanders to the Gulf of Guinea. PHOTO | AFP 
Port Harcourt. Bright orange flames flare upwards from a pencil-thin chimney at the Port Harcourt Refining Company, sending thick black smoke into the white clouds above Nigeria’s southern oil hub.

On the ground, workers in boiler suits and hard hats inspect the tanks, valves and gauges around the metal pipes that stretch up, down and across the facility.
In the hush of the control room, away from the hiss of steam and hum of heavy machinery, the refining process is monitored closely on a bank of computer screens.
PHRC boss Bafred Enjugu sees it as a sign that Nigeria -- Africa’s biggest oil producer -- is finally “domesticating” the refining of crude into products, thus improving its energy security and ending a reliance on costly imports.
The talk is of job creation, national pride and the chance to help revive an economy badly hurt by the fall in global oil prices as well as providing fuel for the increasing demands of a growing population.
“To give up on the refineries is like giving up on Nigeria. That’s how strongly I believe about it and we can’t afford to do that,” the PHRC managing director told AFP.
“We can’t go home and tell our children that we have failed to provide the right platform to take off.”
Stop the rot
The Port Harcourt refinery is Nigeria’s oldest, built in 1965, nine years after oil was found under the marshy soil and creeks of the delta, where the Niger river runs off into the Gulf of Guinea.
Refineries in nearby Warri, and Kaduna in the north central region, were built in the years that followed, while a new plant was added to the same site in Port Harcourt in 1989.
In recent years, however, the facilities have been more idle than operational.
OPEC-member Nigeria instead sent much of the 1.8 million barrels of crude it now produces daily to foreign facilities, buying back refined products such as petrol at market prices.
By the end of Goodluck Jonathan’s presidency, just how reliant Nigeria had become on imports became clear when a dispute between marketers and the government caused a crippling fuel shortage.
Muhammadu Buhari, elected on an anti-corruption ticket, replaced Jonathan in late May, days after the blockade was lifted, and vowed to end years of graft and mismanagement.
Less than a month later, the state-run Nigerian National Petroleum Company (NNPC), of which PHRC is a subsidiary, said all four refineries would resume operations.
Buhari, who accused Jonathan and his predecessors of having “run down” the refineries since the return to civilian rule in 1999, then sacked the entire NNPC board.
A probe was ordered into “mind-boggling” sums of oil revenue allegedly diverted into private accounts, and a Harvard-educated lawyer was named to run the NNPC and make it commercially viable.
Thorough overhaul
Enjugu’s efforts and optimism reflect what appears to be a new era and mindset at the NNPC.
The new group managing director, Emmanuel Ibe Kachikwu, has promised to uproot the firm’s “anything goes” culture and warned of sackings for under-performance.
The Port Harcourt refineries can refine up to 210,000 barrels of crude a day but are currently operating at 60 percent of capacity.
“After 14 years we have had to clean up, to do a thorough overhaul of the system,” explained Enjugu. 
(AFP/The Citizen)

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