NNPCL signs deal to build 100,000bpd plant in PH refinery

Alex Omenye
Alex Omenye

The Nigerian National Petroleum Company Limited has finalized a contract with African Refinery Port Harcourt Limited to construct a 100,000 barrels per day refinery within the Port Harcourt Refinery and Petrochemical Complex located in Rivers state.

This significant development was disclosed by the national oil company via its official communication channel, with Dapo Segun, the Executive Director of Downstream at NNPC, signing the agreement on its behalf.

ARPHL, described as a special purpose vehicle dedicated to co-locating the 100,000 bpd crude oil refinery in Nigeria, elaborated on its role and objectives on its website. The company outlined its involvement in response to a Request for Proposal issued by the Ministry of Petroleum Resources in 2016, which sought bids from private investors to transfer brownfield crude oil refineries to existing refinery sites in Kaduna, Port Harcourt, and Warri.

The aim was to swiftly enhance Nigeria’s national refining capacity. ARPHL asserted that it submitted a comprehensive proposal to NNPC within the stipulated deadline and applied for the Port Harcourt collocation opportunity alongside 11 other investors.

As a result of presenting the most comprehensive package, ARPHL emerged as the winning bidder for the Port Harcourt co-location project, although the specific contract value was not disclosed.

The memorandum of understanding (MoU) outlined the agreement between ARPHL and NNPC, wherein ARPHL would own and operate the 100,000 bpd refinery on a 46-hectare parcel of land adjacent to the Port Harcourt Refinery Complex. This arrangement would afford ARPHL direct crude supply from NNPC and access to shared services such as security, electricity, water, storage, and a jetty.

However, some stakeholders expressed concerns about the timing of this new agreement, especially given the ongoing rehabilitation efforts at the Port Harcourt refinery.

Despite the completion of phase 1 of the 210,000 bpd Port Harcourt refinery in December last year, operations are yet to commence. Critics questioned the rationale behind signing a new deal to construct an additional refinery while existing projects remain inactive.

Nevertheless, NNPC hailed the signing of the agreement as a significant step toward bolstering local refining capacity.

The new refinery, once operational, is poised to supply a range of petroleum products, including Premium Motor Spirit, Automotive Gas Oil, Aviation Turbine Kerosene, Liquefied Petroleum Gas, and others, catering to both local and international markets while creating job opportunities for Nigerians.

Meanwhile, the capital city of Abuja and its neighboring states grappled with a worsening petrol supply crisis, leading to the closure of several filling stations and leaving commuters stranded.

Long queues formed at the few operational stations, with prices soaring as high as N680 to N700 per liter. However, NNPC attributed the supply challenges to logistical issues, assuring the public that the situation had been resolved and urging against panic buying. Chief Corporate Communications Officer Olufemi Soneye emphasized that petroleum product prices remained unchanged and emphasized the country’s sufficient product reserves.

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