You need to active Javascript on your
BusinessDay
Nigeria's leading finance and market intelligence news report.

Nigerian refineries not working is institutional not technical problem – expert

… some refineries built in 1932 still work in other climes

Chairman of the Society of Petroleum Engineers (SPE), Joe Nwakwue, says worsening crisis in having Nigerian refineries work optimally is as a result of institutional problem and not technical problem.

He notes that  some refineries in other climes  are more than 100 years of age yet perform optimally, insisting that technical competence is not the major problem in getting Nigerian refineries perform optimally but failure of the state.

“Technically, the refineries can work here in Nigeria. But the problem of our refineries not working is more institutional than technical. I work earlier in a company which had a refinery built in 1932, and that refinery is still up and running optimally,” Joe said on Monday in Abuja while briefing news men on the forthcoming Oloibiri Lecture Series.

He pointed out that private refineries were coming and they will run efficiently, adding that it was more to the failure of the state that the refineries were not working effectively.

“Private refineries are coming up. It touches the deeper issue which is the failure of the state. Things will not change except for private sector refining. The move towards private sector refining is the answer and they are coming.”

It would be noted that Nigerian refineries made a cumulative loss of N123.25bn from January to October, which has remained a source of worry to industry analysts despite assurance of turn around maintenance by the corporation.

Speaking further, he said most International Oil Companies, IoCs, leaving Nigeria’s downstream because they cannot compete with state owned corporation which has all paraphernalia of state might and support.

“Why would you create a situation whereby NNPC becomes the major supplier of the market and you expect the IOcs to compete with them? No sensible investor goes to compete with the state owned corporation and entity,” he said.

He states that state owned entity has all the power and strength of the state behind it, adding thet that is what is happening in the downstream.

“It is institutional and a technical challenge. It has to do with market structure. If you de-regulate the sector, you see a whole lot of people playing in that market structure.”

Speaking further on the conference, he said, “This is our annual technical conference and exhibition. They needed to have a conference that addresses policy issues.”

He noted that the conference would enable the policy makers and industry players to address challenges in the industry and provide solutions to them through constant engagement.

Oloibiri was born out of that desires to continuously engage the regulators and the industry players on way forward in advancing oil industry business that drives competition.

 

Whatsapp mobile

Get real time updates directly on you device, subscribe now.