After eight postponements by the Nigerian National Petroleum Company Ltd (NNPCL), the hope of the Port Harcourt Refining Company coming into operation appears elusive, Weekend Trust reports.
Many unmet timelines
Promises made to Nigerians by the Federal Ministry of Petroleum Resources and the NNPCL about the refinery commencing operations have not been kept.
Upon assuming office in 2015, President Muhammadu Buhari declared that Nigeria would no longer import petroleum products by 2019, and the Port Harcourt Refinery was key to achieving this goal. The NNPC (Nigerian National Petroleum Corporation) then promised to bring the refinery back to full capacity within two years. However, despite setting an ambitious deadline for 2017, the rehabilitation efforts stalled due to funding challenges and bureaucratic red tape.
In 2019, the government acknowledged that the refinery had still not been restored to full capacity. A new deadline was set, projecting that the rehabilitation would be completed by 2020. The NNPC signed an agreement with an Italian engineering company, Maire Tecnimont, for the first phase of the rehabilitation. Despite this, delays in the contracting process, challenges in securing funding, and logistical issues once again derailed the project, and the 2020 deadline went by without results.
In March 2021, the Nigerian government made another attempt, approving $1.5 billion for the rehabilitation of the Port Harcourt Refinery, with a new completion date set for 2023. This marked one of the largest financial commitments for the refinery’s upgrade. The government announced that the first phase of the refinery’s operations would begin in December 2022, followed by full completion in 2023. However, there were doubts over the actualisation due to the refinery’s long history of missed deadlines and unfulfilled promises.
As the 2022 deadline approached, it became clear that the target would not be met. The rehabilitation efforts were again pushed back, with government officials blaming supply chain disruptions caused by the COVID-19 pandemic, delays in the arrival of equipment, and security challenges in the Niger Delta. New promises were made, with completion now projected for the second quarter of 2023.
In 2023, after nearly a year of repeated assurances, the refinery was still not operational. The NNPCL and the government continued to shift the deadlines, citing the need for further testing and calibration of equipment. Despite these setbacks, the Minister of State for Petroleum, Heineken Lokpobiri, stated that the refinery would be fully operational by the end of 2023, which also did not materialise. The deadline was further extended to 2024.
In March 2024, the Group Chief Executive Officer of NNPCL, Mele Kyari, said the Port Harcourt refinery had received 450,000 barrels of crude oil and would begin operations in April. This, however, did not happen.
Kyari had disclosed this at a press briefing after he appeared before the Senate Ad-hoc Committee investigating the various Turn Around Maintenance projects of the country’s refineries.
In July 2024, the Group Chief Executive Officer of the NNPCL, Mele Kyari, stated categorically that the refinery would come into operation in August of 2024.
He gave the assurance while addressing an emergency session at the National Assembly joint committee on finance.
Kyari explained that the Port Harcourt refinery would kick off production by August this year, while that of Kaduna will commence by December 2024.
The NNPCL failed to deliver the Port Harcourt refinery in August as promised, but again, announced a new deadline of September 2024.
Chief Financial Officer of the NNPCL, Umar Ajiya, said that the Port Harcourt refinery will commence operations in September.
Speaking to journalists in Abuja, he said the petroleum products will be ready for testing before supply to the domestic market in September. It is almost two weeks into September and it remains to be seen if indeed the facility will roar to life this month.
At the refinery complex where the rehabilitation work is ongoing our correspondent learnt that mechanical and electrical works have been completed at Area 5, while work at Area 1 is still ongoing. Area 5 has the capacity of refining 60 barrels of crude per day, Weekend Trust gathered.
Mr Billy Gillis-Harry, the National President, Petroleum Products Retail Outlets Owners Association of Nigeria, (PPROOAN), who said he visited the rehabilitation site recently said with what he observed, refining of petroleum products will resume very soon at the refinery.
He said, ‘We do strategic synergy relationships and our objective is to encourage the system. Our objective is to encourage the government, NNPCL, the refinery, Dangote and all of them to be able to collectively put in their best and ensure that Nigerians have refined products in the country and it is on that note that we have access to discuss the issues of refinery in the country.
“I can tell you from our observation during the visit that every single thing that needs to be done technically has been put in place so they are now working through the processes. The refinery has to go through a process and that process can take 19 days; it can take 90 days; it can take 180 days and that’s what is going on.
“We are pushing them gradually; we are monitoring what they are doing and encouraging them to try to make sure that they realise that we are the ones that will be taking those products from them to deliver to the public. So, that is the premise on which we do what we do. We do not have the technical expertise to be able to say what has been put in place but we can see that production is inevitable. Production of petroleum products at the Port Harcourt refinery will happen|,” he said.
A Port Harcourt-bases oil and gas analyst, Chief Michael Okwuma, said refining of petroleum products at the refinery will be a gradual process.
He said, “Work has reached an advanced stage at the complex with information at my disposal. They have completed all the mechanical and electrical works. What I feel is delaying the resumption of refining activities is the instrumentation process which does not come easy. It involves a nuclear process which requires lots of accreditation and clearance from all the relevant authorities concerned”.
A staff of one of the companies handling the project said work in Area 5 has been completed.
“I can tell you that work has been completed in Area 5. All the electrical and mechanical works have been completed in Area 5. Sand blasting has been carried out to ensure easy movement of crude to the refining furnace. We have moved to Area 1, where work is ongoing. Some contractors who have completed their jobs have left the site while others who still have work to do are still around,” stated the source who pleaded anonymity.
CSO speaks
The Executive Director of Youths and Environmental Advocacy Centre, Mr Fyface Dumnemene, said the continuous shift of the goal post by the federal government in the resumption of activities at the Port Harcourt refinery calls for concern.
Dumnemene said, “multiple dates have been fixed for the refinery to resume production but this has not happened. As the Executive Director of Youths and Environmental Advocacy Centre (YEAC-Nigeria) that has been following the policies and programmes of the government over the years, I said earlier that the promises of resuming production were premature and not feasible because the refinery is far from completion.
“The government is not sincere in relation to the date of the resumption of production at the Port Harcourt refinery. They even later promised that there will be resumption of production in Port Harcourt refinery 2, by November 2024, but with the first refinery not ready till date, that is not also going to be feasible.
“All these are signs of the non-commitment of the federal government of Nigeria to resume production at the Port Harcourt refinery,” he said.
The Minister of State for Petroleum, Senator Heineken Lokpobiri, told newsmen last year that he was holding the NNPCL accountable for the completion of rehabilitation work at the refinery.
“I want to make it very clear that I am not the one who is rehabilitating the refinery, the NNPC which is our national oil company is the body responsible for the rehabilitation of the refinery even before I came into office. I’m pushing them because of the importance of refineries in the country to ensure that they meet the target. Let’s have the first phase working then the second and the third phase will work at the end of next year and that is what they are doing and I am holding them accountable,” he said.
The company is composed of two refineries with the capacity of refining 210,000 barrels of crude oil per day.
The EPC contract for the rehabilitation work at the Port Harcourt refinery complex was awarded by former President Muhammadu Buhari-led government in March 2021 to Italy’s Tecnimont S.P.A, a subsidiary of Maire Tecnimont Group, at the contract sum of $1.5 billion.
According to the contract documents, the project entails engineering, procurement and construction activities for a full rehabilitation of the Port Harcourt refinery complex, aimed at restoring the complex to a minimum of 90 per cent of its nameplate capacity, to be delivered in phases from 24 and 32 months and the final stage expected to be completed in 44 months from the award date.
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