FG Spent $1.78 billion On Refineries in 12 Yrs

Posted by admin Latest Politics Saturday, December 24th, 2011

A whopping $1.78billion has been spent on Turn Around Maintanance of the nation’s four refineries in the last twelve years. The refieries are in Kaduna, Port Harcourt and Warri respectively.

Despite the huge sums of money spent on these refineries, Saturday Tribune learnt that they are operating suboptimally.

Data from NNPC’s Annual Statistical Bulletin for 2010 shows that the Kaduna refinery operated at 31.39 per cent capacity utilisation in 2001; 34.95 per cent in 2002, 15.96 per cent (2003), 26 per cent (2004), 33.08 per cent (2005), 8.34 per cent (2006), 0.00 per cent (2007), 19.56 per cent (2008); 20.02 per cent (2009), and 20.46 per cent (2010).

The Port Harcourt refinery on its own did not fare better In 2001, it operated at 60.73 per cent, 52.17 (2002), 41.88 percent (2003), 31.04 per cent (2004), 42.18 per cent (2005), 50.26 per cent (2006), 24.87 per cent (2007), 17.84 per cent (2008), 9.08 per cent (2009), and 9.17 per cent (2010), averaging 34 percent in ten years.

Warri operated at 48.29 per cent in 2001, 55.53 per cent (2002), 14.27 per cent (2003), 9.10 per cent (2004), 54.85 per cent (2005), 3.85 per cent (2006), 0.00 per cent (2007), 38.52 per cent (2008), 43.01 per cent (2009), and 43.36 per cent (2010).

Saturday Tribune findings revealed that the KPMG/SSA audit commissioned by the Finance Ministry in 2010 confirmed low capacity utilisation at all the plants, which was attributed to partial or complete shutdown of processing plants as well as pipeline vandalisation.

The report indicated that the processing fee earned by the refineries for processing crude oil into petroleum products has not been sufficient to meet the total operating cost of the refineries, resulting in operating losses at the plants.

Though the refineries are operating sub- optimally, it was learnt that the sum expended on repairing the refineries could be used to build at least two new refineries with a capacity of about 120,000 barrels per day.

-Tribunewp_posts