On Tuesday, November 26, 2024, the Nigerian National Petroleum Company Limited (NNPC Ltd.) announced the recommencement of petroleum production from the oldest refinery in the country, the Port Harcourt Refinery.
NNPC also announced the truck-out of petrol, diesel, kerosene, and other products at the refinery, with the capacity to load 200 trucks daily.
Located in Alesa Eleme, in Rivers State, the Port Harcourt Refining Company (PHRC) complex houses two refining plants: the old, which was commissioned in 1965, and the new, which was commissioned in 1989.
The old Port Harcourt refinery, which was built in the year 1965, stopped production over 21 years ago, while the new Port Harcourt refinery stopped production in 2019.
In March 2021, the federal government, burdened with the petroleum products importation and its attendant effect on the economy, approved a $1.5 billion loan to rehabilitate the refineries.
The rehabilitation project is an Engineering, Procurement, Construction, Installation & Commissioning (EPCIC) project that is aimed at restoring the refinery to full functionality and renewal.
NNPC said it has achieved over 16 million manhours with zero Loss Time Injury (LTI).
Even though the rehabilitation of the refineries missed several production rollout deadlines before the recent announcement, NNPC was resolute in its determination to resuscitate the refineries.
It said currently, the functional plant at operation is the old refinery with the capacity of 60,000 barrels per day, while the new plant, which has the capacity of 200,000 barrels per day, is still under rehabilitation and expected to commence production soon without prior announcements.
According to the national oil company, the refinery is currently operating at 70%, while plans are on to ramp up production to 90%.
FUEL IMPORTATION
Prior to this time, Nigeria depended on refined product importation to meet domestic consumption demands. Even with the importation, the country continues to experience scarcity of the products, bringing untold hardship on the citizens.
Data from the National Bureau of Statistics (NBS) shows that the country imported 20.30 billion litres of petrol in 2023. In 2022 it was 23.54 billion litres.
According to the 2023 full-year foreign trade data, Nigeria’s fuel import cost was N7.5 trillion. In 2022, the cost was N7.7 trillion.
In the first six months of 2024, the country’s petrol import bill stood at N5.8 trillion. This was attributed to a 50% drop in the nation’s domestic consumption from the 2 billion litres being imported, following the fuel subsidy removal.
The importation of petrol into the country has significantly declined as Dangote Refinery continues to ramp up production to meet domestic demand.
According to S&P Global Commodity Insights ship-tracking report published in October, only 240,400 barrels of gasoline and blend stock were imported into Nigeria during the first week of October, marking a sharp decline from the weekly average of 1.3 million barrels recorded in August.
The report said in the week ending October 13, only one product tanker was reported to have shipped gasoline to Nigeria, carrying 290,567 barrels from Antwerp to Lagos.
These October shipments are significantly lower than the 12 cargoes dispatched in the first half of both August and September. Since October 8, no additional gasoline shipments have been brought into Nigeria.
The coming on stream of both the Dangote and Port Harcourt Refineries would not only end fuel importation and stabilise fuel supply and distribution domestically but would help generate foreign exchange earnings and stabilise the Naira.
NIGERIAN REACT ON REVIVAL OF PORT HARCOURT REFINERY
While some Nigerians are applauding the NNPC Ltd. for resuscitating the refinery, others are doubting the functional status of the plant. They claimed that the refinery is not producing products as widely celebrated by the NNPC Ltd.
Responding to these unfounded claims, the company noted that the refinery is producing the following daily outputs: “Straight-Run Gasoline (Naphtha): Blended into 1.4 million litres of Premium Motor Spirit (PMS or petrol), Kerosene: 900,000 litres, Automotive Gas Oil (AGO or Diesel): 1.5 million litres, Low Pour Fuel Oil (LPFO): 2.1 million litres, and Liquefied Petroleum Gas (LPG): Additional volumes.”
It said the refinery incorporated crack C5, a blending component from its sister company, Indorama Petrochemicals (formerly Eleme Petrochemicals), to produce gasoline that meets required specifications.
It maintained that blending is a standard practice in refineries globally, as no single unit can produce gasoline that fully complies with any country’s standards without such processes.
Meanwhile, the Chief Security Officer, Alesa Kingdom, Rivers State, Dibia Isaiah, said the refinery is operational and running smoothly.
“I am a loader, and as you can see, the refinery is operational and running smoothly. This morning, I have already loaded four trucks. We are delighted that business has finally commenced after many years,” he said.
On his part, Abba Audu Benishirkh said, “The NNPCL has accomplished a landmark achievement by successfully reviving the Port Harcourt Refinery, thereby silencing the multitude of skeptics and critics who had dismissed the project as a lost cause.
“This remarkable feat not only underscores the NNPC’s unwavering commitment to revitalising the nation’s refining capabilities but also serves as a testament to the company’s unrelenting perseverance in the face of adversity.
“By bringing the refinery back online, the NNPC has confounded the naysayers and demonstrated its capacity to deliver on high-impact projects, paving the way for a more sustainable and self-sufficient energy future for Nigeria,” he said.
Also, the Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) affirmed that “the old Port Harcourt refinery is currently operating at 70 per cent of its installed capacity, with plans to ramp up to 90 per cent. This is contrary to the speculations that the revamped and celebrated refinery is a mere blending plant and unproductive as circulated by most naysayers.
“As part of PETROAN’s oversight function as key stakeholders, we have direct access to the plant on the authorisation of management, and we will encourage whoever is doubting the functional status of the plant to contact NNPC management for a facility tour rather than spreading misleading information.
“Further confirmation for the authenticity of production at the Port Harcourt refinery was verified by the Senate Committee on Petroleum Resources under the able leadership of Distinguished Sen. S A Kawu Sumaila, in conjunction with stakeholders and members of the host community.
“The Senate Committee was on a fact-finding/investigation on Thursday, 28th November 2024, at the Port Harcourt refinery and depot at Alesa Eleme to see things for themselves. The Senate committee saw the plant functional and petroleum trucks loading at the Port Harcourt refinery depot.
“It is worth noting that PETROAN National leadership, led by the national president, Dr. Billy Hary, were in attendance at the Senate committee visitation at the Port Harcourt refinery to welcome the committee and express PETROAN’s willingness to commence loading at the Port Harcourt refinery.
“PETROAN opined that the appropriate thing at the moment is to commend the team of NNPCL management led by Engr. Mele Kyari that was able to revive a plant that has been moribund, deplorable, and dormant for over 21 years,” the Association said.
Corroborating PETROAN, the National President of the Nigerian Society of Chemical Engineers, Mr. Tony Ogbuigwe, said, “The truth of the matter is that Area 5 of the Port Harcourt Refinery is running and indeed running. The refinery has two parts; there is the old refinery and the new refinery.
“The old refinery is the one that has been brought back into operation, and we can confirm that it is running. We have made contact with our professional colleagues—the chemical engineers who are on the ground—and they have confirmed that the refinery is indeed running.
“The products are being produced from the old refinery, and those products are being blended to give the PMS that we consume in our cars and diesel oil, which we consume in trucks, and which some of us use in our generators. Kerosene is also being produced. That is the truth,” he said.
Also responding to the naysayers, former Minister of Aviation, Femi Fani-Kayode, said, “It is a pity that some elements in the private sector who are new in the field are doing all they can to undermine and understate this great victory for Nigeria.
“Let the new kid on the block flourish, but let the NNPC refineries flourish too. That should be our goal and not a squalid attempt to discredit NNPC and its leadership.
“Every optimistic and true lover of Nigeria’s progress and President Tinubu’s renewed hope agenda must be proud of the GMD, Mele Kyari.
“His tenacity, bravery, ingenuity, and forthrightness have been rewarded with this great feat. Surely this is hope renewed for Nigerians,’’ he said.
In his submission, the Special Adviser to the President on Information and Strategy, Mr Bayo Onanuga, said, “I was part of a fact-finding team that visited the 60,000 barrels daily Port Harcourt Refining Complex on Wednesday.
“Our mission was to verify the rumours circulating about the refinery’s state, and I am pleased to report that we were satisfied with what we saw.
“Our team, guided by the refinery’s Managing Director Ibrahim Onoja, toured the entire complex, from the computerised control room to the loading bay and every section in between. We asked pointed questions and received satisfactory answers, dispelling our doubts and misconceptions.
Nigerians must ignore naysayers and false information about the refinery’s operations. While it is not currently running at 100%, it is functioning at 70% installed capacity, with plans to increase production shortly.
“Furthermore, the refinery receives regular crude supplies, contrary to claims that it lacks crude to refine. During our visit, we confirmed that the refinery produces petroleum products, including kerosene, low-pour fuel oil, LPG, diesel, and gasoline. The latter is blended with other products to make the petrol we use in our cars. We even tested samples of the products.
“The refinery’s recent overhaul has transformed it into a modern facility. We saw upgraded and replaced parts, including part of the 300km new pipelines. Some parts the company had not changed in 27 years have been replaced with new ones, bringing the refinery up to 21st-century standards. The revamping work has indeed brought the refinery back to life. What was once a 20th-century refinery has been transformed into a state-of-the-art facility.
“We also visited the co-located second Port Harcourt refinery, commissioned in 1989. Workers were busy dismantling old, rusty parts and replacing them with new ones. Although officials declined to provide a timeline for its completion, there was an air of confidence that it would soon be operational, joining its 60,000-barrel-a-day counterpart. My curiosity has been satisfied.
“I commend NNPC Limited and the refinery team for reviving this dead asset, which was on the verge of becoming a museum piece. Our fact-finding mission has buried the various doubts and lies about the Port Harcourt Refinery Complex,” he said.
Meanwhile, the national oil company said it has not yet commenced bulk sales or opened its purchase portal for the refinery, as essential processes are still being finalised.
It noted that the products being sold currently were bought from the Dangote Refinery with applicable NMDPRA fees, clarifying that products from the PH refinery are exclusively for its retail stores at the moment.
While noting that its pricing is reviewed and adjusted periodically as necessary to reflect operational realities, the company advised the public to disregard any misleading information regarding pricing as official announcements would be made if and when price reviews occur.
