NNPC set to announce contractor-financiers for all four refineries, Eni fingered
Strong indication emerged Monday evening that the Ministry of Petroleum through the Nigerian National Petroleum Corporation (NNPC), any moment from now, will announce foreign contractor-financiers for the revival of bellow capacity producing national refineries.
Currently, all the national refineries including two in Port Harcourt, one each in Warri and Kaduna are producing far bellow installed capacities.
Additional details revealed that NNPC had been finalizing discussions with financiers abroad since last week and may announce the bid winners as soon as possible.
Business Hilights recalls that earlier in the year, the Minister of State for Petroleum, Dr Ibe Kachukwu had met with officials of Agip/Eni in Italy and discussed terms of repairs before the deal was suspended following denial of fund appropriation by the National Assembly.
National Assembly had queried the rationale in spending huge amount of public fund on repairing the refineries regularly without any tangible result and based on that to throw out the NNPC’s demand which prompted the Corporation to think out of the box and came up with contractor-financer model for the moribund refineries.
However, analysts are still apprehensive on the veiled nature of the funding arrangement to avoid privatizing the national assets in the name of contractor-financing.
The fear is driven by the sources of refunding the contractor after returning the refineries to productivity.
The four refineries have an installed capacity of 445,000 barrels per day but they have continued to operate far below the installed capacity for many years.
Besides, the refineries lost a total of N68.12 in the first half of this year due to their sub-optimal operations, according to the latest data from the NNPC.
According to the Group General Manager, Group Public Affairs Division, NNPC, Ndu Ughamadu, “Efforts are on. The financiers have been approved and discussions are ongoing with them. But the local refineries, Port Harcourt and others, are operational. When they don’t have the supply of crude oil, they won’t operate at a given level. But now the systems are in a good place.
“However, we are still negotiating with the financiers. If you have to put your money in an investment, there must be a series of discussions and negotiations because the financiers are bringing in the resources that we will use for the rehabilitation. That is the level we are in right now.”
“Also, the top management of the corporation went abroad two weeks ago to further discuss with the financiers. The financiers have been chosen by the board, but I don’t have the details right now.”
NNPC did not reveal the names of the prospective financiers even as negotiations near consummation.
