Yemisi Izuora/Ijeoma Agudosi
Chrome oil, has explained that Nigeria’s four refineries are unable to function at full capacity as a result of insufficient crude oil supply.
The company a major contractor to the Port Harcourt, Warri and Kaduna refineries, said the refineries are not scraps either.
Clarifying the issue while fielding questions from energy correspondents, executive chairman of the group, Emeka Offor said it was the intention of government to revive the refineries but such step was considered inappropriate owing to upsurge in the vandalisation of pipeline facilities.
Offor, said that Turn-Around-Maintenance (TAM) is a huge and expensive project which ought to be carried out every two years.
According to him, maybe the government decides not to conduct it over the years due to vandalism which prevented the refineries from getting supplies.
If you continue to executive such capital intensive repairs without securing the pipeline infrastructure and do not supply feeds to run the refineries, it is not economical.
The two critical factors for the refinery business is for the refinery to get feeds because it works round the clock. This means we must ensure that the issue of vandalism is stopped. If that happens, government will make sure they monitor pipeline and get supplies to the refineries through the pipelines.
Nigerians have to be educated on the dangers of pipeline vandalism to the economy. Other countries have pipelines and cables, they don’t vandalize them our refineries will work well if we stop vandalism.
He said the last TAM was done in 2000, but noted however, that it did not mean they were totally not functional.
“At various times, we have been invited to carry out emergency services to keep some of the units running.
We have been doing that, and also government has commenced marine transportation of crude supply to the refineries and they refine them, though that option is more expensive” Offor pointed out.
He therefore, challenged government to expedite action on security of such vital economic infrastructure.
“This job is not for the NNPC alone, governments at all levels must sensitize the populace.
If the feeds get to the refinery as at when due, every refinery has daily allocation, it will be running effectively, if they produce, they will make profit and be able to pay contractors that are maintaining them.
Offor, also warned against sustenance of subsidy regime, arguing that “if we get adequate fuel supplies to every part of the country, due to the operations of the refineries, at a subsidized rate and prices at neighbouring countries like Niger, Chad, Ghana, Benin Republic and others are higher than ours, you will open opportunity for black market to thrive on price arbitrage.
Marketers will lift products here and go and sell over there. But if the subsidy is removed, and price is at par or even higher than in those countries, then black market will not thrive”.