The Ministry of Petroleum Resources in collaboration with oil companies, is working on several initiatives beneficial to host communities, including working with illegal refiners to participate in modular refineries that will be established. PATRICK ANDREW reports
That perhaps was the defining moment in the life of this administration vis-a-vis its relationship with the people of the Niger Delta region and the beginning of the end to the hitherto sustained bombings of crude oil pipelines. It also demonstrated sincerity in government’s quest to up crude oil production, increase earnings and revamp the economy.
The Vice President in what some had termed as ‘a political Masterstroke’ threw the hat into the ring in an uncharacteristic empathy for the plight of the people of the oil producing areas.
Professor Osinbajo at a novelty town hall meeting with the people of the region where he openly identified with them beyond the mere political rhetoric, declared that the federal government has adopted a new vision and a radical approach to solving Nigeria’s perennial fuel scarcity hiccups and the less than cerebral destruction of local or illegal refineries. Local or “illegal” refiners in the oil-producing communities are to be co-opted as shareholders and assisted to contribute meaningfully to Nigeria’s oil wealth through refining the product for local consumption.
Accordingly, he said rather than destroy the motley of illegal or native refineries, the government was considering converting them to modular ones and thus avail their operators opportunity for inclusive participation in the creation of wealth and jobs.
It was a masterstroke because it would not only ensure the reduction of youth restiveness occasioned by unprecedented unemployment in the region, but would stabilise oil production in the country and increase revenue for the federal government.
Unlike the initial military approach to solving militancy in the region, the federal government succumbed to superior persuasion and opted for dialogue as it decided to roll down its sleeves and collaborate with the leaders of the region, who had earlier presented a 16-point demand on behalf of the region.
This eventually snowballed into town hall meetings where the federal government demonstrated understanding and care for the sufferings of the people and thought it wise to dialogue with the restive youths who had been attacking oil and gas installations thereby forcing drastic cut in crude oil output.
Of course, Nigeria’s less than 1.3 million barrels per day production down from 2.1 bpd on an average had greatly hurt government finances thus contributing in some ways to the subsequent economic recession. The attacks had intensified despite persistent military build up in the region.
Though the records are not adequate, but some have claimed that no fewer than 6,000 illegal refineries are operational in the creeks. Of the lot, thousands have been reportedly destroyed by the Joint Military Task Force (JTF)- one of the instruments the government thinks it could use to stamp out militancy in the region and halt attacks on oil and gas installation to no avail.
Economic sabotage has been the basis for destroying these local refineries and some experts argued that the ‘refineries’ are rickety and therefore posed no little threat to the environment. Yet, others see the rickety ‘science projects ‘being over-glorified as ‘oil refineries.’ But the rickety ‘refineries’ produced enough to hurt government revenue as foreign importers buy off both the crude and refined products at high sea.
However, in sharp contrast to the militaristic approach, the Vice President chose the option of steadily reaching out to the people in a fresh perspective:
“We must convene an oil-communities intervention meeting to work out what can be done in the short to medium term and the long term possibilities. We must focus on how to ensure that the people see the benefits of the wealth of the land.
“This new vision will define the future of the region. Oil exploitation by itself cannot suffice to assure our people of decent jobs and a decent income.
“We must make our oil producing communities’ hubs for petro-chemical industries, small and large. We must make these communities hubs for refining and related activities,” Osinbajo said swiftly contradicting the usual assertions that illegal refineries are perpetrated by economic saboteurs.
Interestingly, the Nigerian National Petroleum Corporation (NNPC) keyed in to further amplified government’s inclusive participation and growth as canvassed by proposals in the National Economic Recovery and Growth Plan (ERGP).
The Corporation’s Group Managing Director (GMD) Dr. Maikanti Baru, thinks the modular refinery will help instil sanity in the downstream sector. While delivering a keynote address at the Executive Intelligence Management Course, EIMC 10 of the Institute for Security Studies, Bwari, Abuja, he applauded the modular refineries initiative and described it as the panacea to provide the much needed improved production and availability of the petroleum products.
Dr. Baru revealed plans for modular refineries in the Niger Delta Region stating that the government hopes to place youths involved in illegal refining of crude oil into groups. Each group is expected to refine one thousand barrels of crude daily.
“The establishment of these modular refineries and the transformation of already established illegal refineries are focused on having integrated energy outfit with interest in power generation and transmission,” Baru explained.
Similarly, the Ministry of Petroleum Resources said conversion of the illegal refineries to modular ones was the goal of President Muhammadu Buhari. Minister of State, Dr. Ibe Kachukwu, said President Buhari is deeply worried about the huge environmental degradation and environmental pollution that is associated with the unprofessional, unscientific and unconventional methods being adopted by local refinery operators in the country.
Kachukwu said the federal government has decided to encourage the establishment of modular refineries in Niger Delta with serious encouragement to local refinery operators to key into the project and thus tame restiveness.
“The President is so concerned about the Niger Delta environment and has assured the ministries and all its agencies of his readiness to ensure that some of the bureaucratic requirements needed for the establishments of such a refinery would be relaxed so that foreign investors Missouri American Energy Moham and Community Capital Group of Canada can be encouraged to do business under the new dispensation”, the petroleum minister said mentioning of the many companies lining to build modular refineries.
So far, the government has taken the modular refinery concept beyond the level of talks and proposals to presentation of modalities for operation and participation. Last April it held a meeting with technical persons and leaders of the region where some modalities were highlighted.
Already, states in the Niger Delta have declared their readiness to cooperate with the government and the private sector to develop modular refinery concept as solution to the operation of illegal refineries in the region.
Under the plan, communities would come together, working under their respective state governments with the federal government and private sector operators, to design the template for the modular refineries in their communities.
Vice President Osinbajo said during the meeting: “It should be one of the models of what we will be doing in the future. We will engage on the basis of trust, we must prove that we are trustworthy,” he said and thanked the leaders of the region for taking the initiative to support government’s actualisation of a plan for the region.
He noted that the modular refineries to be established would have to be profitable and realistic in order to address critical issues bordering on the development of the region on a sustainable basis.
