The Senate Thursday bemoaned the moribund state of the nation’s four petroleum Refineries located in Portharcourt, Warri and Kaduna, wondering how $25billion spent on their turnaround maintenance (TAM) within the last 25 years did not make them optimally functional and the $396m.
It consequently mandated its committees on Petroleum (Downstream), Upstream and Gas, to carry out thorough investigation on why the Refineries have remained moribund over the years.
The committees are to investigate the turn around maintenance carryout by the NNPC and ascertain their current state.
The decision to investigate the poor state of the refinaries followed a motion moved to that effect by Senator Yusuf Abubakar Yusuf ( APC Taraba Central), .
Senator Yusuf in the motion tagged: “The Moribund Refineries In The Country,” noted that the Nigerian National Petroleum Corporation (NNPC) has four refineries: two in Port-Harcourt (PHRC) and one each in Kaduna (KRPC) and Warri (WRPC).
According to him, the refineries were established to adequately supply and serve needs for Liquefied Petroleum Gas (LPG), Premium Motor Spirit (PMS), Dual Purpose Kerosene (DPK), Automotive Gas Oil (AGO), Low Pour Fuel Oil (LPFO), High Pour Fuel Oil (HPFO) and Aviation Turbine Kerosene (ATK) for both local consumption and exports.
He recalled, “The country through NNPC has in the past 25 years spent Billion of US dollars in Turn-Around Maintenance of the refineries, the latest being over $396 million spent between 2013 and 2015 without meaningful result.”
The lawmaker lamented that “the refineries have remained in moribund state in the last 15-20 years and is almost reaching total collapse due to lack of proposer maintenance of the facilities with a poor average capacity utilization hovering between fifteen percent and twenty-five percent per annum.”
He disclosed that “despite the huge spending on turn-around Maintenance of refineries, NNPC recently announced a cumulative loss of N123.25 billion in 10 months (January to October, 2019), putting the total revenue of facilities at N68.82 billion, while total expenses incurred was N192.1 billion within the same period.”
He warned that “such huge wastage and slippages amidst the nation’s tight economy, if not addressed, may lead the country back to recession.”
The lawmaker added that such losses, when averted and combined with the huge expenditures in “under recovery” on fuel pump price and properly channeled into full rehabilitation and construction of modern refineries, would positively impact on the economy and save the country from the embarrassment of importation of petroleum products and its ripple effect.
In his contribution, Ibikunle Amosun (APC Ogun Central) who commended Yusuf Abubakar Yusuf for the motion, said one of the problem the country is facing is lack of maintenance culture.
He said it was not the first time attention was drawn to the near collapse of the refineries in the country and urged his colleagues to do a thorough job during the probe exercise by the committees.
“Oil should be a blessing to us but in Nigeria, it make alot of establishments lazy. We should be concern about it. The refineries are bad and people are now taking the crude outside the country and bringing back refined products to the country on exobitant prices.
“The downstream committee should critically look at the problem, because $25 billion dollars went down the drain in turnaround maintenance of the refineries in the last 25 years,” Amosun said insisting that they must make sure all the strategic assets in the country works including the refinaries for good revenue generation.
“It will be on the interest of all of us to increase the internally generated revenue,” Amosun added. Accordingly, the Senate resolved to investigate the non optimal performance of the refinaries, urging the NNPC to do total overhaul of the refinaries.
The Senate also direct it’s committees on Petroleum, Upstream/Down Stream and Gas to carry out an oversight on the Nigeria refineries and report back.
Senate President, Ahmad Lawan, said the Petroleum Industry Bill (PIB) would be worked upon in February adding that there are issues that will occupy the committee members saddled with the responsibility of investigating the state of the refineries but urged them to do a thorough job and report back to the Senate.
