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FG, Agip reach fresh deal to build new refinery in Port Harcourt

The results of the recent visit of the Minister of State, Petroleum Resources, Dr. Ibe Kachikwu to Italy where he met with top officials of the Agip group has started emerging as he revealed on Tuesday that the Federal Government and oil giant have reached an agreement to build a new refinery in Port Harcourt or Brass.

When completed, the refinery will bring total number of federal refineries to three.

Explaining additional details, the Minister said the Memorandum of Understanding on the new refinery with 150,000 barrels capacity was already being prepared.

He dropped the hint during an interview with State House correspondents after leading the oil firm’s management team to a meeting with the Acting President, Yemi Osinbajo, at the Presidential Villa, Abuja.

According to him, Agip has the second largest power plant in the country which will be on stream by 2020 and the company’s total investment in power and the refinery was in excess of $15bn.

While calling on other International Oil Companies (IOCs) to learn from the Italian giant, Dr. Kachukwu advised other multinationals operating in the country to emulate the firm.

He said “We just finished a meeting with the Acting President and Agip. In the meeting, we dealt with the issue of Agip’s investment in Zabazaba Field and their cooperation with us in the repairs of Port Harcourt Refinery.

“Following my meeting with Agip, we reached an agreement that Agip will build a brand new refinery of 150,000 barrels capacity which will be located in Port Harcourt or Brass. They have accepted and are preparing an MOU along this line.

“The effect of this is that oil companies operating in Nigeria will begin to migrate from only exporting crude and begin to look at how to start refining this crude so that we will be able to meet our local consumption.

“This new refinery, along with other things we are going to do with the refinery in Port Harcourt gives us hope in our quest to try and increase our local capacity to produce every refined product we need in the country and to meet the timeline of 2019.

“We are now going ahead to work out the modality with Agip. I am also calling on other multinationals to see what they can do along this line.

“In the area of power, Agip has the second largest plant which will be on stream by 2020. This is to make sure they are not only just taking away crude but making other local investment. Total investment in the area of power and the refinery from Agip is in excess of $15bn.”

Analysts say on delivery, the refinery will be the first in the series of an IOC/FG joint refinery project in Nigeria.

Business Hilights recalls that all existing refineries are owned fully by the federal government.

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