NNPC Signs Deal to Build Another 100,000bpd Refining Plant within Port Harcourt Refinery

*Fuel queues worsen in Abuja, environs, NNPC says issue resolved

Emmanuel Addeh in Abuja

The Nigerian National Petroleum Company Limited (NNPC) yesterday signed a contract with African Refinery Port Harcourt Limited (ARPHL) to build a 100,000bpd refinery within the Port Harcourt Refinery and Petrochemical Complex in Rivers state.
The national oil company disclosed the deal on its X handle, indicating that the Executive Director, Downstream of the NNPC, Dapo Segun signed on its behalf.
On its website, ARPHL described itself as the special purpose vehicle incorporated for the specific purpose of co-locating the 100,000bpd  crude oil refinery in Nigeria.

It stated that in line with the strategic plan of the Ministry of Petroleum Resources, the NNPC in 2016 advertised a Request for Proposal (RFP) , seeking bids for private investors to transfer brownfield crude oil refineries to the existing refinery sites in Kaduna, Port Harcourt and Warri.
According to the firm, this was aimed at increasing Nigeria’s national refining capacity in the shortest possible time frame.
ARPHL said it submitted a comprehensive proposal and solution to NNPC by the deadline and applied for the Port Harcourt collocation opportunity along with 11 other investors.

It stated that by virtue of having the “most complete package”, it was declared the winning bidder for the Port Harcourt co-location project. However, the value of the contract was not stated.
“Under the aforementioned MoU, we entered into an agreement with NNPC, whereby ARPHL will own and operate the 100,000 bpd refinery on 46 hectares of vacant land adjacent the PHRC ’s refinery complex, where we will benefit from direct crude supply from NNPC and access to other shared services, e.g. security, electricity, water, storage, jetty,” it added.

However, a source told THISDAY that it did not make sense that the Port Harcourt refinery, which had been under rehabilitation for years had yet to begin operation and another deal was being signed to build an additional one.
Recall that part of the $1.5 billion facility to repair the Port Harcourt plant was taken from Afreximbank at the time, a debt which the NNPC is supposed to be servicing.
In December last year, the company announced the ‘mechanical completion’ of phase 1 of the 210,000bpd Port Harcourt refinery. Since then, it has not started refining crude oil.

“NNPC Ltd.’s move to boost local refining capacity witnessed a boost today with the signing of share subscription agreement between NNPC Limited and African Refinery Port Harcourt Limited for the co-location of a 100,000bpd capacity refinery within the PHRC complex.
“The signing of the agreement is a significant step towards setting in motion the process of building a new refinery which, when fully operational, will supply Premium Motor Spirit (PMS), Automotive Gas Oil (AGO),  Aviation Turbine Kerosene (ATK),  Liquefied Petroleum Gas (LPG), and other petroleum products to the local and international markets and provide employment opportunities for Nigerians,” the NNPC said in the announcement.

Meanwhile, several filling stations remained shut in Abuja and its environs yesterday as the petrol supply crisis which began a few days ago, worsened.
Aside Abuja,  Nasarawa, Niger, other states close to the federal capital were impacted by the supply challenge, leaving commuters stranded.
Motorists besieged the few filling stations, including NNPC, resulting in long queues on Obasanjo Way, Zone 1, Conoil as well as Total filling stations opposite the NNPC headquarters in Abuja.

It was the same story at in Zuba, Niger State at AYM Shafa,  NNPC outlet on Arab Road, Kubwa,  Nyanya, Nasarawa State, among others. The situation was the same at stations owned by AA Rano, Mobil, NIPCO and Ardova Plc.
While the few open filling stations were selling for as high as N680 per litre and N700, at the roadside black market, the product sold for up to N1,000 per litre.
But in a reaction, the NNPC stated that the problem arose from logistics issues, assuring that it had been resolved.

“The Nigerian National Petroleum Company Limited (NNPC Ltd) wishes to clarify that the tightness in the supply of PMS currently being experienced in some areas across the country is as a result of logistics issues and that they have been resolved.
“It also wishes to reiterate that the prices of petroleum products are not changing. It urges Nigerians to avoid panic buying as there is a sufficiency of products in the country,” Chief Corporate Communications Officer,  Olufemi Soneye, said in a statement.