PENGASSAN Cautions FG on Sale of Refineries

Ernest Chinwo in Port Harcourt

The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) has called on the federal government to be cautious in its plan to sell or concession some refineries in the country.
There have been speculations that the federal government plans to sell or privatise some refineries in the country, especially the Port Harcourt and Warri refineries.

But PENGASSAN said there was nothing wrong with the Port Harcourt Refinery, stating that the refinery was currently producing at 60 per cent capacity and would do better if it had better supply of crude oil.
Addressing journalists yesterday after a tour of the Port Harcourt Refinery, the Group Chairman of the Nigerian National Petroleum Corporation (NNPC) of PENGASSAN, Sale Abdullahi, advised the federal government to be cautious in its plans.

Abdullahi, who is contesting to be national president of PENGASSAN in its forthcoming election, said it is wrong for the federal government to say that the Port Harcourt Refinery is not working.
He said: “I heard news reports that the refineries are not working but today, we have decided to invite you to come and see for yourself and we have gone through the Control Room and you can see that all the components of the refinery are working.

“The only challenge now is capacity utilisation, which at the moment is 60 per cent. We will like to have it more than that. We will like to take it to the level of 90 per cent or 95 per cent utilisation.”
He explained: “Yes, we hear about concessioning, we are not averse to concessioning, we are not averse to privatisation. However, what we are saying is that no nation will like to toy with the issue of energy. At the moment, at the position we are, we don’t want a situation where 100 per cent of the energy sector is given to private hands. We want to maintain some level of security because energy is security.

Just like we cannot give our security to private hands 100 per cent, we should equally not do it in the case of energy. That is the reason why we are saying, when you are bringing in investors, bring those that will add value to the refineries. Not being able to do maintenance, certainly it is because of finance. We welcome those that will come with finance to help us in the area of maintenance, we partner together, we make profit together but with the guarantee that that the energy security of the nation is in the hands of government. That is our take.

“Do I support the sale of the refinery? No and yes. We are not supporting the sale of the refinery in totality. As we know, the PIGB has been passed in the Senate. Even provisions of that PIGB makes room for 20 per cent government equity to be in the hands of the Bureau of Public Enterprise and that means that eventually, the 20 per cent will go up. What we are saying is that at the moment, it doesn’t make sense for you to give 100 per cent of your energy sector to private hands.

“Yes, you will like to do it but it has to be a gradual process; you have to start by giving out small percentages and monitor the progress made. Because other areas we have made that mistake of transferring our assets 100 per cent to private hands, we have seen where it landed us. So, it is not a good idea to give 100 per cent privatisation at first instance. We need to start gradually and monitor the progress and if it is good for the nation, then we go that way.”
He conceded that the refineries could perform better if the current challenges were taken care of.

“Key among the challenges is crude supply; without crude supply, of course, there won’t be a refinery. The other challenge is evacuation. Even when we refine, we expect that there will be loading of those products to create room for new products that are coming in. We have challenges with that evacuation. Sometimes, because we are dealing with machines, they will fail; because of maintenance issues here and there. You can see for yourself that the refineries are okay,” he said.

He noted that the oil and gas sector of the economy has numerous challenges but said there was need for the federal government to come up with a road map to harness the gains of the sector.
“The way forward is to come up with a roadmap of what exactly you want to achieve in the oil and gas industry. Also, to plan to move away from oil and gas in the event that in the future that commodity becomes irrelevant in the economy. So, that roadmap is key and we have to look at capacity building in other area,” he said.

He however expressed the hope that the Petroleum Industry Governance Bill (PIGB), when finally passed, would take care of the challenges currently faced in the industry.
On his policy thrust if elected National President of PENGASSAN, Abdullahi said, “My policy thrust is to run a Union that is not only focused on members’ welfare but focused on business; on ensuring that all the plants that we have are up and running. That is our primary aim because it is only when you have the plants running that you will be able to cater for the welfare of your members and also provide jobs for members out there. With that, you can increase your membership portfolio.

“As Nigerians, we are really stakeholders in three folds; one is that we are Nigerians and we know that Nigerians want to have products at affordable prices and without interruptions; two, we are PENGASSAN members, we want to make sure that our staff strength and our membership strength is maintained; three, we are staff of these refineries, we want to make sure that the welfare of our members is also guaranteed. So, that means the refinery is our farm, we wouldn’t want anyone to toil with it and whoever want to come around to toil with it, we wouldn’t want it.”