The NNPC oil refineries owned by the Federal Government recorded a total loss of N18.96bn in the first two months of this year, the Nigerian National Petroleum Corporation has said.

Latest data from the NNPC showed that the refineries, which the corporation manages, lost N9.60bn in January and N9.36bn in February.

Nigeria, which is the continent’s top oil producer, relies heavily on importation for refined petroleum products, since its oil refineries have remained in a state of disrepair for several years, despite several reported repairs.

The refineries, which are located in Port Harcourt, Kaduna and Warri, have a combined installed capacity of 445,000 barrels per da,y but have continued to operate far below the installed capacity.

The NNPC said in April that it had secured funding for the rehabilitation of the ailing refineries.

The Group Managing Director of the NNPC, Mallam Mele Kyari, said the corporation was pursuing “a different model” for the refineries, including the type used by the Nigeria LNG Limited.

The NLNG is jointly-owned by the Federal Government, represented by the NNPC (49 per cent), and three international oil companies, namely Shell (25.6 per cent), Total (15 per cent) and Eni (10.4 per cent).

Kyari said the corporation would no longer be involved in running the refineries after their rehabilitation.

He added that upon completion of the ongoing rehabilitation, the services of a company would be procured to manage the plants on an operations and maintenance basis.

In the first term of President Muhammadu Buhari, the NNPC had planned to rehabilitate the refineries to attain a minimum of 90 per cent capacity utilisation.

The plan was to use third-party financiers and the original refinery builders to provide the requisite funding and technical support.

However, after over one and a half years, negotiations with financiers were stalled in December 2018, owing to varying positions on key commercial terms.

Kyari, who took over the NNPC leadership in July 2019, had reiterated his plan to revamp the refineries and end fuel importation by 2023.

Justin Nwosu

Justin Nwosu is the founder and publisher of Flavision. His core interest is in writing unbiased news about Nigeria in particular and Africa in general. He’s a strong adherent of investigative journalism, with a bent on exposing corruption, abuse of power and societal ills.