NNPC to outsource refinery management after repairs

Nigeria’s national oil company will outsource the operations and management of the country’s refineries after ongoing rehabilitation, the company’s boss said in a briefing in Abuja Tuesday.

Mele Kyari, CEO, NNPC Ltd, said this was part of conditions by lenders who are financing the rehabilitation of the refineries. He said the NNPC already has contracts in place and contractors have been hired with the objective of restoring the refineries to 100 percent of installed capacity.

“We will get the refineries back and run it as a business, we borrowed money to fix it and repayment for loans obtained is tied against the productivity of the refineries,” said Kyari.

Kyari said the NNPC Ltd will have operations and maintenance contracts with contractors who will run the refineries because the lenders cannot trust the corporation’s capacity to run the refineries.

Read also: Nigeria banks on 1.6m oil barrels daily for 2023 budget, in shift to cautious estimates

“Our lenders have said except you decide through a transparent process to put in place an O and M contractors otherwise we can’t lend you money,

“As we complete work on them, we will hand over to OM contractors both for Kaduna and Port Harcourt refineries

We think this is the right thing to do, many companies get OM contractors to do this around the world “ he said.

Kyari said Nigeria will end the importation of petrol by the middle of next year based on expectations that its refineries would be back on stream and the Dangote Refinery would have been running.

The NNPC boss said in the interim, petrol would still be imported to augment the need for rising population and energy demand.

He said NNPC Ltd’s 20 percent stake in the Dangote refinery which comes with a right of first refusal to supply crude to the refinery, gives the company a competitive edge in selling its crude and extracting value from refined petrol.