Fuel Crisis: Nigerian oil marketers hint at time products scarcity will end 

*Nigerian fuel marketers insist the current scarcity will not end until the Federal Government rehabilitates the ailing oil refineries to ensure fuel availability and sustainability for consumers

*Restoring Warri and Kaduna Oil Refineries will guarantee energy security for Nigeria, says NNPC Limited

Isola Moses | ConsumerConnect

Amid the reoccurring scarcity of Premium Motor Spirit (PMS), otherwise known as petrol, oil marketers, under the aegis of the Independent Petroleum Marketers Association of Nigeria (IPMAN) have projected the situation will continue until Nigeria resumes refining petroleum products domestically and halts complete reliance on imports.

ConsumerConnect reports the West African country still largely imports its PMS and other refined crude oil products as of now.

This scenario persists because Kaduna, Warri and Port Harcourt are not operating at the moment, after being dormant for several years.

However, the Nigerian National Petroleum Company (NNPC) Limited has said work is currently ongoing at the facilities to restore them.

Hitherto, the NNPC Limited, which is regarded as the sole importer of petrol into Nigeria, has been grappling with the burden of subsidy on PMS, sequel to the dwindling Naira value against the United States (US) Dollar and other fiscal challenges in the Nigerian economy.

Oil marketers, nevertheless, Friday, February 3, 2023, declared that the recurrence of fuel scarcity across the country would come to a complete stop, only when the Nigeria starts refining crude locally, report said.

The marketers’ association also observed that the challenges associated with the imports of refined petroleum products had been on the increase lately, particularly since the invasion of Ukraine by Russian forces February 2022.

Products imports no longer sustainable –Marketers

Meanwhile, the oil marketers have posited that PMS importation is not sustainable any more, especially in view of the changes in the oil and gas sector currently.

They insisted that the Federal Government must strive to commence in-country refining of products in order to ensure product availability and sustainability.

Zarma Mustapha, Deputy National President, Independent Petroleum Marketers Association of Nigeria, was quoted to have said: “The crux of the whole issue of petroleum product supply is the lack of refining capacity that we don’t have in the country.

“If we cannot be able to develop enough refining capacity in the country, this persistent on-and-off fuel scarcity situation will not end.”

Mustapha stated he was aware that the government, through NNPC, was working on Nigeria’s refineries, but stressed that the pace had been so slow.

The IPMAN top official also said: “I am happy with what the NNPC boss and the government are doing now to revive the Port Harcourt refinery, as the first step of the rehabilitation of our refineries, while the second phase is going to be the Warri and Kaduna refineries.

“But the concern we have is that the rate at which they are doing the repairs is too slow.”

According to him, the National Oil Company (NOC) should urge the contractors to do their jobs fast.

“I also pray the Dangote Refinery starts production within the shortest possible time.

“This will help us to reduce the extent of dependence on imported petroleum products.

“With that, it would address at least 70 percent of the issues we are having with our refined petroleum products distribution,” Mustapha said.

NNPC, Daewoo Engineering and Construction sign agreement for revival of Kaduna Refinery

Efforts are also ongoing to get other Nigerian refineries functional.

NNPC and Daewoo Engineering and Construction Nigeria Limited last Thursday signed a contract of $740.67million (N341.48billion as of Thursday’s official exchange rate of N461.04/$) for the rehabilitation of Kaduna Refining and Petrochemical Company (KRPC) Limited .

It was gathered that both parties signed the deal at the Abuja Headquarters of NNPC, as Adeyemi Adetunji, Executive Vice-President, Downstream of NNPC Limited, said that the exercise would take 21 months to complete.

Adetunji disclosed the quick-fix strategy would see to the repairs and re-streaming of KRPC, as well as ensure its operation on a sustainable basis at a minimum capacity utilisation of 60 percent.

The contract, he also noted, marked a milestone in the history of KRPC, considering the fact that the last Turn Around Maintenance (TAM) on the refinery occurred about 15 years ago, and that the project was framed after extensive engagement with Daewoo.

Adetunji also stated that the quick-fix strategy would guarantee the fastest route to re-streaming the Warri Refining and Petrochemical Company (WRPC) and KRPC for in-country production of refined petroleum products.

He stated: “Restoring WRPC and KRPC to operations will guarantee energy security for the country, reduce dependence on imported petroleum products in view of near total dependence on supply of imported petroleum products and the impact the ongoing Russia-Ukraine war is having on global supply.”

The rehabilitation of the Port Harcourt Refining Company had progressed considerably, said Adetunji.

He added: “The old refinery is currently al 64 percent completed and the plant is expected back in operation in Q2 2023, while the entre PHRC rehabilitation project currently stands at about 59 percent.

“On the other hand, WRPC quick-fix project has achieved 28 percent completion and is expected to be re-streamed by the end of this year.”

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