Local refineries even at full capacity not sufficient for Nigeria’s fuel consumption – Expert

A professor of petroleum engineering at the Federal University of Petroleum Resources Effurum (FUPRE), Ogbarode Napoleon, has said that petrol production by the local refineries will not be sufficient for local consumption by 2020.

According to him, even with operation at full capacity, the Kaduna, Warri, Old Port Harcourt, New Port Harcourt and the Dangote refineries would not be able to cater for local consumption without the aid of modular refineries.

In his presentation titled “An assessment of the economic viability and competitiveness of modular refineries in Nigeria”, at the Nigerian International Petroleum Summit (NIPS) on Wednesday, ‎Mr. Ogbarode reviewed statistics that proved his submission.

“The four refineries will give 7.51billion litres of PMS per year. In the same vein, the Dangote 650,000 capacity refinery will give 10.97 billion litres. Total PMS production at the refineries operating at full capacity will be 18.48 billion litres”.

According to him, the plot of the 2010 to 2016 data on import and consumption indicates a gradual increase of about 700,000,000 liters of PMS per year based on the NNPC monthly financial and operations report.

Therefore, “By 2020, consumption will be 18 billion + 700 million multiplied by three, which equals 20.1 billion litres of PMS,” he said, leaving a short fall of over 1.5 billion. He added that modular refineries would have to cover for this to make local production sufficient.

He highlighted absence of pipeline vandalisation due to proximity to crude source; high rate of return in two to six years compared to 15 years of conventional refineries and ease of plant production capacity increase due to its amenability as the advantages modular refineries have over the conventional ones.

In response to the professor’s presentation, the Senior Technical Adviser to the Minister of State for Petroleum, on Refineries, Downstream and Infrastructure, Rabiu Suleiman, said “we have gone so far as a consumer nation and therefore we’ve not been able to export petroleum products. Rather we consume all and yet it’s not sufficient, further justifying the need for us to have additional refineries in Nigeria.”

He also said that there will be a sufficient market in Africa for export when about two to three refineries like the Dangote refinery come on board.

Babajide Soyode, who represented the Chief Executive Officer of Dangote group, Aliko Dangote, at the summit, said the government should not get involved with the development of modular refineries but instead create an enabling environment for private sector investors to build the refineries.

He also gave a progress report on the development of the Dangote Refinery.

“Work is progressing on the site 24 hours, seven days a week. The purpose built jetty and shore protection works are to be completed by April facilitating the delivery of ODC in June.

“Training of Nigerian graduates in India, the United States of America and Europe for operation and maintenance has commenced with about 900 trainees and technicians in all projected,” he said.

He added that the support and cooperation from the federal, state and local authorities as well as local communities have been tremendous so far.