Local Oil Refiners Seek CBN, NNPC’s Intervention to Address Funding, Feedstock Challenge

•Want all incentives given to Dangote Refinery extended to them

Peter Uzoho

Indigenous oil refiners under the aegis of Oil Refiners Association of Nigeria (CORAN) have appealed to the Central Bank of Nigeria (CBN) to create crude refinery intervention fund similar to the agricultural credit fund or the pharmaceutical fund domiciled at the apex bank to drive effective business operations in the country.

They also called on the Nigerian National Petroleum Company (NNPC) Limited to consider taking equity or grant loans to modular refineries via the provision of reformer and other requirement units to ensure adequate production of petrol based on agreed offtake conditions.

In fact, they pleaded that the CBN and NNPC should extend all incentives and assistance given to Dangote Refinery to them.

CORAN members led by their Board of Trustee’s Chairman, Chief Emmanuel Iheanacho, made the appeal during their visit to the leadership of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) in Abuja.

They urged the NNPC, NMDPRA and Nigerian Upstream Petroleum Regulatory Commission (NUPRC) to engage with the licenced modular refineries in order to develop an appropriate commercial model that would guarantee reliable feedstock.

According to a statement issued yesterday by CORAN and made available to THISDAY, the meeting with the regulator which was in a bid to interact with all relevant regulatory agencies, was chaired by the NMDPRA’s Executive Director, Hydrocarbons Processing Plants, Installation and Transportation Infrastructure, Mr. Francis Ogaree.

The Secretary of CORAN, Mr. Olusegun Ilori, who presented CORAN’s position, appealed to the authority to ensure that all incentives that were given to Dangote Refinery are also extended to other refineries.

CORAN also stated that NMDPRA’s renewal fee for modular refinery license guidelines be revisited and possibly reduced by way of 50 per cent waiver.

They suggested that such review should be on the company-by-company assessment, and granted to only companies with credible challenges.

CORAN further suggested that annual monitoring of modular refineries be carried out by the authority to ensure compliance with government policies.

The association requested that the NNPC should consider taking equity or grant loans to modular refineries via the provision of reformer/other requirement units to ensure adequate production of PMS based on agreed offtake conditions.

They equally suggested that the issuance of the import duty waivers for modular refinery equipment be done by the Federal Ministry of Finance after due certification of the equipment that qualified for waiver was done by the Ministry of Petroleum Resources.

CORAN said modular refinery owners with evidence of feedstock challenge be given preference in the allocation of NNPC’s crude oil.

Additionally, the local refinery owners further suggested that crude oil from the NNPC be sold to modular refinery owners in naira according to prevailing market rate with guarantee that all the refined petrol be sold in naira in line with the market price in-country.

The statement added, “The Federal Ministry of Industry, Trade, and Investment to collaborate with Ministry of Petroleum Resources on the African Continental Free Trade Area (AfCFTA) with the view of creating a Petroleum refining hub in Nigeria while leveraging on the Agreement;

“Quarterly progress reports on modular refinery projects be sent to the Ministry by NMDPRA.

“The ministry should liaise with Nigerian Immigration Service to resolve problems associated with issuance of expatriate quota.”

Responding to CORAN, the management of NMDPRA led by Ogaree and the Executive Director Economic Regulations and Strategic Planning, Dr. Zainab Gobir appreciated the association for coming and assured the team that President, Muhammadu Buhari was committed to see that more refineries are functional.

Ogaree further assured CORAN of the authority’s support and urged them to reach out to the committee that will be set up to work with refineries, and hinted of a database of challenges and progress report on our operations.

On her part, Gobir, who mentioned that with regular consultation, some of the CORAN’s issues could be raised at economic policy levels, pledged the agency’s support for the association.

She assured that her office would create a dialogue for more communication between the refiners and the authority, assuring the association of the government’s economic strategic plan to boost refining in Nigeria from a 0.01per cent to one per cent.

“The Authority will support the association, not only as regulators but  as partners for progress of the sector rather to ensure that the refining goal and vision for the country is achieved,” she added.