Oil Industry Players Seek Special Forex Window for Modular Refineries Operators

•Want crude feedstock scarcity addressed

Emmanuel Addeh in Abuja and Peter Uzoho in Lagos

Oil and gas industry players in the country have requested the Central Bank of Nigeria (CBN) to create a unique window for modular refineries operators to enable them access foreign exchange and facilitate seamless operations.

The stakeholders also called on the authorities to initiate action to address the nagging issue of irregular supply of feedstock to the modular refineries, which they lamented is hampering the smooth operations of the plants.

The demands were contained in a communique released at the just-concluded Nigerian Content Midstream and Downstream Oil and Gas Summit organised by the Nigerian Content Development and Monitoring Board (NCDMB). The document was read by the Manager, Corporate Communications, NCDMB, Mr. Esueme Kikile.

Industry operators further advocated that the federal government should divest from the petroleum depots and address the dysfunctions of Nigerian pipeline infrastructure.

Participants also requested that the NCDMB should consult more with midstream/downstream stakeholders to co-produce solutions to the peculiar challenges confronting the sector. According to the NCDMB, the recommendations were geared towards addressing some of the challenges of the sectors which were identified by the delegates.

“These included that the midstream/downstream sectors face uncertainty due to the sustenance of subsidies, inconsistent supply of feedstock, and the broken product distribution infrastructure.

“They also highlighted the challenges that modular refinery operators face in sourcing forex and called attention to the hurdles and delays that complicate the process of operationalising a valid import waiver,” the communiqué stated.

The two-day summit received 11 papers and featured three-panel sessions and at the end came up with high-impact actions that would help to maximise the potentialities in the midstream/downstream sectors of the oil and gas sector

 One of the action items, the players said, was an increase in NCDMB’s collaboration and alignment with other relevant ministries, departments, and agencies as well as stakeholders to mainstream Nigerian content bottom lines.

These areas, they said involved refining, processing, storage, construction, fabrication, distribution, marketing, and retail which would help liberate the potential of the sectors.

Part of the resolutions after the event which was attended by the Minister of State, Petroleum, Mr. Timipre Sylva and other top industry stakeholders, included the need to encourage accelerated investment in modernising and upscaling the local supply chain to ease petroleum product distribution.

In addition, the participants called for the formulation and implementation of policies and interventions to support indigenous operators and make them globally competitive in terms of quality delivery and product pricing.

“The recommendations also included the need to incentivise the collocation of modular refineries and the depots and the Free Trade Zones (FTZs) to enable easy offtake of petroleum products and promotion of the utilisation of gas as an energy source of choice in Nigeria and addressing the forex liquidity constraints of indigenous companies.

“Participants at the summit observed that the midstream and downstream sectors have numerous leverage points to create value and these opportunities are yet to be fully explored.

“They also indicated that the modular refineries could be potential game-changers as they are well-suited to meet the demands for refined petroleum products in their catchment areas,” part of the communiqué added.

It also quoted participants as lauding the board and its leadership for building the momentum of Nigerian content with a call to support the progress achieved so far.

While commending the attendees, the Executive Secretary, NCDMB, Simbi Wabote, in a vote of thanks, assured participants that their recommendations would be considered during policy formation.

He also promised that the board would liaise with relevant agencies to address some of the identified challenges that are outside the remit of the NCDMB’s mandate.

 “We will prioritise and try to unlock the challenges and continue to push the limits,” he concluded.