The fact that the promise made that Port Harcourt Refinery will come on stream by December 2023 was not achieved should not get Nigerians discouraged. This is because, if you look at the whole scenario on the ground around the plant, you will be convinced that there is hope and assurance and there will be relief for Nigerians in 2024.
After all, if the deadline was achieved in December 2023 the positive impact of the exercise could only be felt in 2024 and not 2023. However, if Nigerians are disappointed, they should not be blamed because past governments have promised them at different times in the past and they failed to meet these deadlines. Because of this, Nigerians no longer trust their governments at various levels.
December 2023 was indeed the timeline given by the Minister of State for Petroleum, Heineken Lokpobiri that the Port Harcourt Refinery would come on stream, sadly enough, the refinery was not able to produce those products expected of them, but, he said that other lines of productions will come after Christmas when he made public the Mechanical Completion of the refinery has been achieved. Meaning that the refinery rehabilitation is not completed yet and that there still more jobs to be done.
The Mechanical Completion of the refinery has however given Nigerians some ray of hope, assurance, relief and even confidence that Nigerians’ yearnings for domestic production of petroleum products in large volumes in 2024 is not only assured, but is guaranteed.
There is hope that the plant will come up in the first quarter of this year and without any unforeseen circumstance it would come to full operations by the second quarter this year.
The plant’s mechanical completion is the most strategic and important foundation the plant needed to have, and perhaps the most complex aspect of the whole project. After achieving Mechanical Completion the other production lines will follow seamlessly.
These production lines are already in place, but they just needed to test run them to be sure that there are no air, impurities and other unwanted bodies in the pipes that could cause an explosion when the whole plant begins production. Safety checks are fundamental to the operations of such huge plants as refineries. This detail is important and it could take some time to be carried out satisfactorily. This is what has been delaying the coming on stream of the 650,000 barrels Dangote Refinery.
To ensure that the plants effectively take off by the first quarter or latest second quarter of this year, workers of various categories are busy working at the plant site on the 1st of January 2024. They are working on the different lines of production just to ensure that the much-needed relief for Nigerians in terms of production of refined products in 2024 becomes a reality.
It is important to state that Nigeria will surely reduce the level of importation of refined products significantly come 2024. This is because, aside, from the 60,000 barrels Port Harcourt Refinery coming on stream in the first quarter, the new Port Harcourt Refinery is being worked upon to ensure it comes on stream by the last quarter of this year.
Another good news is that the Mechanical Completion of the 125,000 barrels per day Warri Refinery has been slated for the end of January 2024.
This would be followed by a test run of the plant in February and by the second quarter of 2024, the refinery would start operations fully, the source said.
According to the source, the NNPCL and its management have determined that both Port Harcourt and Warri Refineries will be up and working at least by the first half of Next year. By this, he said, the country’s dependence on importation of Petrol would have greatly reduced.
He said that even though the volume of refined petrol from both the 60, 000 barrels from Port Harcourt Refinery and the 125,000 barrels Warri Refinery and Petrochemical will not be made public now, the products from them, coupled with what will be coming from Dangote Refinery will significantly help the country to stem the tide of petrol importation by the Nigerian Government.
He said the Kaduna Refinery and Petrochemical Company is the only one he is not sure when it will start production next year but surely, work is ongoing to revive the plant and save foreign exchange, and create jobs for the country.
However, people must note that Mechanical Completion is not a full rehabilitation of the plants but a process leading to that.
The Minister of State for Petroleum, Heineken Lokpobiri stated in August this year that Nigeria expects its four oil refineries to be operational by the end of next year, starting with the Port Harcourt plant in 2023 December.
“From what we have seen here today, Port Harcourt refinery will come on board by the end of the year,” he said, adding that two other facilities in Warri and Kaduna will start processing crude between the first quarter and end of 2024.
The Nigerian National Petroleum Company (NNPC) Limited after the facility tour of the plant, said it has fulfilled its pledge of achieving the mechanical completion of rehabilitation work on Area 5 Plant of the Port Harcourt Refining Company (PHRC).
Rehabilitation work has been ongoing at the Refinery for over two years and the NNPC Ltd. had pledged to complete Phase One of the project (mechanical completion and flare start-up) of Old Port Harcourt Refinery (Area 5) by 31st December 2023.
Speaking during an inspection tour of the rehabilitation project, which also coincided with the 15th Refineries’ Rehabilitation Steering Committee Meeting, the Group Chief Executive Officer, NNPC Ltd., Mr. Mele Kyari, said as of December 15th, 2023, 84.4% of Area 5 Plant, a key component of the Refinery, and 77.4% of the entire rehabilitation project have been completed.
“In our quest to ensure that this refinery is re-streamed to continue to deliver value to Nigerians, we made a promise that we will reach a mechanical completion of phase one of the rehabilitation project by the end of December and get the other plants running in 2024. Today, we have kept those commitments,” Kyari stated.
The GCEO commended the NNPC Ltd.’s staff and the EPCIC contractors for doing a great job in ensuring that the refinery achieved that significant milestone.
In his remarks, the Chairman of the NNPC Ltd Board, Chief Pius Akinyelure described the milestone as “historic”, stressing that the board was proud of the staff and management of the refinery.
“We are just starting. We want to be at the highest level of production so that we will keep the prices of petroleum prices in the country stable to give comfort to our people and generate more revenue for our country,” Akinyelure noted.
Also speaking, the Honourable Minister of State for Petroleum Resources (Oil), Senator Heineken Lokpobiri, said the milestone is another landmark of the renewed hope agenda of President Bola Ahmed Tinubu, GCFR.
He thanked Nigerians for their patience and the trust they have in NNPC Ltd.’s ability to deliver on this huge project.
In his address, the Minister of State for Petroleum (Gas), Rt. Hon. Ekperikpe Ekpo said re-streaming the Refinery will herald a good omen for the nation’s Liquefied Petroleum Gas (LPG) industry, as LPG, also known as cooking gas, is a major bye-product of the Refinery.
Also speaking, the Managing Director of Tecnimont Nig. Ltd., Fabio Del Cioppo, one of the EPC Contractors of the Rehabilitation Project, said his company remains committed to fulfilling the terms of the contract.
The PHRC rehabilitation project, which costs about $1.5bn, is an EPCIC project that covers Engineering, Procurement, Construction, Installation, and Commissioning phases. For Area 5, the Engineering, Procurement, Construction, and Installation have all been completed. The mechanical completion signifies the closure of the Construction and Installation phases.
More importantly, the milestone was achieved under an excellent Health, Safety and Environment (HSE) record, which stood at over 9.5 million manhours with zero Loss Time Injury (LTI)
Dangote Refinery
Meanwhile, the Dangote Refinery has received at least four cargoes of crude oil put at one million barrels each so far. A source who is in the knowing told Business Standards said: “I can assure you that Dangote Refinery has about four million barrels of crude oil it received from its jetty. The remaining two million barrels will be supplied in January 2024
The Dangote Refinery has taken delivery of crude oil from some deepwater FPSO. They have received over 2 million barrels.
Plant according to reports will need at least six million barrels before it starts operations. Once the six million barrels are fully delivered, it will facilitate the initial run of the refinery as well as kick-start the production of diesel, aviation fuel, and LPG before subsequently progressing to the production of Premium Motor Spirit (PMS).
This latest development will play a pivotal role in alleviating the fuel supply challenges faced by Nigeria as well as the West African countries.
The expected respite will not come the way of Nigerians immediately. This is because the plant will start refining Automotive Oil otherwise known as Diesel, Aviation fuel and other products that are already deregulated before it commences production petrol.
So as the company could not get the required six million barrels at once, it means a further delay to processing petrol. The petrol from Dangote Refinery may not significantly change the price of petrol in Nigeria, but at least there would be respite that there will be a constant source of supply.
Designed for 100% Nigerian crude with the flexibility to process other crudes, the 650,000 barrels per day Dangote Petroleum Refinery can process most African crude grades as well as Middle Eastern Arab Light and even US Light tight oil as well as crude from other countries.
Dangote Petroleum Refinery can meet 100% of Nigeria’s requirement of all refined products, gasoline, diesel, kerosene, and aviation jet, and also has surplus of each of these products for export.
Managing Director of Dangote Ports Operations, Mr. Akin Omole told newsmen at the Dangote Quay, Ibeju-Lekki, Lagos that the Refinery is expecting more crudes before the end of this year to put the Refinery in good stead to commence operation.
The one million barrels represent the second phase of the 6 million barrels of crude oil to be supplied to Dangote Petroleum Refinery by a range of suppliers for the production of petroleum products.
The refinery was built to take crude through its two SPMs located 25 kilometres from the shore and to discharge petroleum products through three separate SPMs. In addition, the refinery can load 2,900 trucks a day at its truck-loading gantries.
Dangote Refinery has a self-sufficient marine facility with the ability to handle the largest vessel globally available. In addition, all products from the refinery will conform to Euro V specifications.
The refinery is designed to comply with US EPA, European emission norms, and Department of Petroleum Resources (DPR) emission/effluent norms as well as African Refiners and Distribution Association (ARDA) standards.
While receiving the first consignment, President of Dangote Group, Mr. Aliko Dangote had stated: “We are delighted to have reached this significant milestone. This is an important achievement for our country as it demonstrates our ability to develop and deliver large capital projects. Our focus over the coming months is to ramp up the refinery to its full capacity. I look forward to the next significant milestone when we deliver the first batch of products to the Nigerian market.”
Also the Country Chairman of Shell Companies in Nigeria, Mr. Osagie Okunbor had said: “We welcome the startup of a refinery that is designed to produce gasoline, diesel, and low-sulphur fuels for Nigeria and across West Africa and are happy to be enabling it.”
