The administration of AIPCC Power Restricted, operators of the Edo Refinery and Petrochemicals Firm Restricted (ERPCL), has raised the alarm on the persistent lack of crude oil regardless of being a completely purposeful 1,000 barrels per day stream crude oil refinery
The refinery mentioned despite the disclosure by the Dangote Refinery on the refusal of the Nigerian Nationwide Petroleum Firm Restricted (NNPCL) and the directive by President Bola Tinubu that the institution ought to provide crude oil to Dangote Refinery and different Modular Refineries within the nation in Naira denomination, the Edo Refinery is but to get any provide from the related authorities.
Chatting with journalists in Benin-Metropolis on the weekend, the administration of the refinery, mentioned the agency is going through vital challenges resulting from persistent lack of crude provide.
Consultant of the corporate, Segun Okeni, who spoke to journalists mentioned the refinery, which required 1,000 barrels per day stream crude can barely perform at full put in capability.
Okeni mentioned although the corporate has current crude oil provide agreements with Seplat and ND Western since 2022, bureaucratic bottlenecks have prevented the refinery from accessing the much-needed useful resource.
He alleged that in 2021, ERPCL’s letter addressed to the Group Chief Govt Officer of NNPCL, Mele Kyari, after collection of conferences and fixed communication him was ignored.
In accordance with him, “On 18th August 2021, our workforce led by our chairman, met with the NNPCL CEO and its prime administration workforce to debate our intention to purchase crude oil from NNPCL and we instantly wrote in search of crude provide,” the letter was dated 22 July 2022.”
He additionally added, “In July 2022, the representatives of NNPC (from HQ Abuja and NPDC Benin) visited our facility for web site inspection and to substantiate the mechanical completion of the Edo refinery. In September 2022, we have been invited for a business negotiation assembly with the NNPCL Head of phrases, after which we despatched a follow-up letter figuring out the oil fields from which we are able to offtake crude oil.
“In March 2022, we additionally wrote to the Ministry of Petroleum Sources, informing it of our refinery standing, future tasks and our challenges of lack of crude oil provide to our refinery. We had additionally written and had a gathering with the NNPC Exploration and Manufacturing Restricted (NEPL) between November 2022 and March 2023, indicating our extreme want for crude oil provide from oil fields the place NEPL has fairness stakes.”
The ERPCL consultant nonetheless, famous that regardless of these conferences, correspondences and communications with NNPCL over the previous three years on the problems of crude oil provide, nothing was finished.
Moreover, he recognized different key points encountered by the refinery as the lack of NNPCL to assign any of the popular fields to allocate crude to the corporate because it began having engagement with the administration on August 18, 2021, stating that even with the choices given to allocate crude to the refinery from ND Western, First Hydrocarbon, and Seplat, nothing occurred until date.
“ERPCL additionally has a Crude Oil Provide Settlement with ND Western to carry crude oil from the Ughelli Pumping Station (UPS) owned by NEPL and operated by Shoreline.
“We now have held a number of conferences with Shoreline and Heritage Oil and indicated our readiness to make modifications wanted to offtake crude oil from the UPS however no progress has been made until date,” the corporate mentioned.
On the best way ahead, ERPCL mentioned NNPCL and different producers have to put loading infrastructure in place to permit for truck loading, decrying why Dangote can be getting 30,000bp as a result of it opened as much as the general public, whereas smaller refineries aren’t being served.
He likened this to lack of respect for smaller companies that may additionally develop the financial system alongside the massive gamers.
The consultant of ERPCL subsequently, search the Kyari’s intervention as group CEO of NNPCL for NUIMS to present incidence to the Seplat-ERPCL settlement to allow Edo refinery to begin lifting crude oil from Oil Mining License.
Describing the previous two years as irritating for the institution, he mentioned, “If we native traders can’t get crude whilst small as we’re, how can international traders be inspired to put money into the nation? The full each day demand of all modular refineries is less than two p.c of the each day crude oil manufacturing. Our lifting from the pumping station will even scale back pipeline losses.”
Okeni argued that the benefit of loading from NNPCL pumping station to the professional terminal is that it prices much less as a result of the price of pipeline export terminal costs and loss might be saved which ought to make the modular refineries extra aggressive than the offshore refineries who come to the export terminal to take the crude, thereby making value financial savings to trickle right down to Nigeria customers.
“If smallest refinery will not be getting crude, it would discourage traders in that space” Okeni mentioned, contending that due to lack of crude, OPAC Refinery operates lower than 3% of its put in capability and Edo Refinery lower than 10% of put in capability.
He famous that Nigeria loses thousands and thousands of {dollars} following the lack of NNPCL to produce modular refineries over the previous three years whose complete put in capability is lower than 30,000bpd.
