FEC approves $1.5 billion for repair of Port Harcourt Refinery.
The Federal Executive Council (FEC) has approved $1.5 billion (approximately N600 billion) for the Port Harcourt refinery’s rehabilitation.
The sum was accepted at the FEC’s virtual meeting on Wednesday, which was presided over by President Muhammadu Buhari.
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The approval comes after a contentious rise in the price of gasoline at the pump, which was later reversed.
Despite the fact that Nigeria has four government-owned refineries, it imports nearly all of its refined petroleum products.
The rehabilitation will be undertaken in three phases of 18, 24, and 44 months, according to Timipre Sylva, Minister of State for Petroleum, who briefed reporters after the FEC meeting.
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He mentioned that the contract was awarded to Tecnimont SPA, an Italian company that specializes in refinery maintenance, according to the minister.
The repairs will be financed in part by the Nigerian National Petroleum Corporation (NNPC), Internally Generated Revenue (IGR), budgetary arrangements, and Afreximbank, according to Mr Sylva.
“The Ministry of Petroleum Resources submitted a memo for the reconstruction of the Port Harcourt refinery in the amount of $1.5 billion, which was approved by council today.
“As a result, we are pleased to announce that the productivity refinery will be rehabilitated in three stages. The first step, which will take 18 months to complete, will bring the refinery up to 90 percent of its nameplate size.
“The second phase will take 24 months to complete, and the final stage will take 44 months to complete, with consultations accepted.
“And this, I believe, is good news for Nigeria.”
The approval of the $1.5 billion to rehabilitate the refineries is expected to be met with mixed reactions, given the country’s history of spending billions on refinery maintenance. Despite this investment, the refineries have not cooperated with many experts who advocate for their privatization.
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A maintenance company would also be created, according to the minister, to ensure an efficient maintenance culture.
“Talking about operations and maintenance, that has been a major problem for our refineries, and it was also thoroughly addressed in council, and the agreement is that when the refinery is fully rehabilitated, we will name a specialist operations and maintenance and operations company to operate it,” he said.
“It’s actually one of the lenders’ requirements, since they said they’d give us the money if we had a competent operations and maintenance company, and that’s already part of our negotiations with the lenders. He said, “We’re not going back on our word.”
On or before May 2023, the minister promised, rehabilitation work on the Kaduna and Warri refineries will be completed.
# Port Harcourt Refinery
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