Latest news with #NigerianMidstreamandDownstreamPetroleumRegulatoryAuthority
Business Insider
29-04-2025
- Business
- Business Insider
Concerns mount as Nigerian refinery shuts down after $897.6m in maintenance funding
The recent shutdown of the Warri refinery barely a month after being declared operational, has sparked growing concerns over the transparency and efficiency of Nigeria's refinery management. According to a document from the Nigerian Midstream and Downstream Petroleum Regulatory Authority obtained by The Punch, the refinery, which absorbed $897.6 million in maintenance costs, failed to produce Premium Motor Spirit (petrol) and was shut down just a month after former NNPC Group CEO Mele Kyari declared it operational. Industry operators and experts have expressed disappointment over the situation. Further findings revealed that the Port Harcourt Refining Company, which resumed operations in November 2024, is operating at less than 40% of its capacity. Despite substantial investments and rehabilitation initiatives, these refineries continue to face operational challenges that hinder their full functionality. The refinery, commissioned in 1978, was designed to supply markets in Nigeria's southern and southwestern regions. Its petrochemical plant has a capacity of 13,000 metric tons of polypropylene and 18,000 metric tons of carbon black annually. Despite receiving $897.6 million in maintenance funding, the refinery ceased operations on January 25, 2025, due to safety issues in its Crude Distillation Unit Main Heater—raising fresh doubts about oversight and performance under the Nigerian National Petroleum Company Limited (NNPCL). Revamp efforts hit wall Nigeria's government-owned refineries have long been plagued by neglect, mismanagement, and corruption—persistent symptoms of the country's troubled oil sector. Despite renewed efforts to rehabilitate the Port Harcourt, Warri, and Kaduna refineries in a bid to reduce dependence on imported petroleum products and boost domestic refining capacity, progress remains slow and uneven. Hopes were briefly rekindled when private sector investments, particularly the Dangote Refinery, emerged as potential game changers for Africa's top oil producer, which has relied on imported fuel for decades. Despite initial optimism, recent developments cast doubt on the government's seriousness in revamping its moribund refineries. According to the NMDPRA document obtained by The Punch, the Warri Refining and Petrochemical Company was shut down on January 25, 2025, due to safety concerns with its Crude Distillation Unit (CDU) Main Heater—barely a month after being declared operational. Meanwhile, the Port Harcourt Refinery, which resumed operations in November 2024, is operating at just 37.87 percent of its installed capacity, far below the 70 percent claimed by NNPC spokesperson Femi Soneye. The refinery, with a nameplate capacity of 60,000 barrels per day, produced an average of 82.55 million litres of refined products monthly between November 2024 and April 2025—about 135.45 million litres short of its optimal output of 218 million litres. These figures sharply contradict NNPC's projections at the plant's recommissioning, where the firm claimed the facility would deliver daily outputs of 1.4 million litres of Straight-Run Gasoline for blending into Premium Motor Spirit (PMS), 900,000 litres of kerosene, 1.5 million litres of diesel, and significant quantities of LPG and jet fuel.
Reuters
15-04-2025
- Business
- Reuters
Nigeria plans petroleum products stockpile to counter global supply shocks
LAGOS, April 15 (Reuters) - Nigeria plans to establish a national strategic petroleum products stockpile this year to safeguard its economy against disruptions in the international market, the petroleum products regulator said at a press briefing on Tuesday. Farouk Ahmed, head of the Nigerian Midstream and Downstream Petroleum Regulatory Authority, said the reserve, which the country's oil law mandates, would mitigate supply shocks and enhance the nation's energy security. Nigeria, despite its oil wealth, frequently experiences fuel shortages and long queues. The country aims to use expanding domestic refining capacity, particularly the 650,000-barrel-per-day Dangote Refinery, to build resilience against global supply fluctuations. While Nigeria currently maintains petroleum products reserves to cover approximately 30 days of supply, Ahmed said the new National Strategic Stock, modelled on the United States' Strategic Petroleum Reserve, would be significantly larger. He did not specify the volume of the planned reserves. Nigeria's Petroleum Industry Law mandates the regulator to issue a bulk petroleum liquids storage licence to private depots that can hold products for as long as needed. Startup of the Dangote Refinery in September, along with five smaller refineries, has significantly reduced Nigeria's gasoline imports from 50.8 million litres per day in September to 28.7 million litres per day last month. Data from the regulator indicate that currently operational local refineries are projected to process 770,500 bpd until June. The regulator expressed optimism that refining expansion could eventually eliminate the need for gasoline imports.
