Random Pagan Verse:
Hazel-the tree of wisdom and learning adds its strength to the bright fire burning.
White are the flowers of Apple tree that brings us fruits of fertility.

Author Topic: Buhari Approves 65 Licences For Private Refineries  (Read 275 times)

Offline internet police (OP)

  • Global Moderator
  • Hero Member
  • *****
  • Date Registered: Jul 2014
  • Posts: 1671
  • Thanked: 2 times
  • Karma: +0/-0
  • do not spam this forum
    • View Profile
Buhari Approves 65 Licences For Private Refineries
« on: August 28, 2015, 03:19:19 PM »
President Muhammadu Buhari has granted licences to 65 Nigerian companies to construct modular refineries. The companies were selected from about 285 applications that were screened for the purpose.

Modular refineries are mini-refineries with capacities ranging from 1,000 to 10,000 barrels per day, bpd, which can be assembled and separated easily for enhanced performance and efficiency.

The decision to award Licence to Establish, LTE, which was taken within 10 days of his assuming office in June, may not be unconnected with his desire to see the increase in domestic refining capacity to meet local demand, thereby reducing huge import bills for subsidy.

Although the Department of Petroleum Resources, DPR, the industry regulator, feigned ignorance of the development, one of the beneficiary companies confirmed to Vanguard that the measure is also meant to cushion the impact of crashing oil prices at the international market.

The shock is not only in the period the approvals were given, but also in the numbers granted considering the fact that 18 LTEs were granted in 2002, but only one of them had come on stream with just 1,000 barrels per day, bpd, capacity.

The refinery is operated by Niger Delta Petroleum Resources, NDPR, which produces only automotive gas oil, AGO, popularly called diesel.

How approvals were granted

Chief Executive officer of the beneficiary company, who spoke in confidence, said the number was not unilateral, but ?the mop up of all applications for private refining since 2007.?

He admitted that the process took a period of six months, dating back to former President, Goodluck Jonathan?s administration, adding ?the process was rigorous as they looked at many issues including, land, investment, technical competence, design and a host of many others.?
He added that licences were offered on a two-year tenure, after which it will elapse, and that ?the beauty of these awards is that there was no lobbying, as the whole exercise followed due process.?

In his opinion, there is nothing wrong with the high number of awardees, arguing that ?for a country like Nigeria, the more in-country capacity, the better for us, because in a falling oil price regime, the more you refine, the more value you add and the more revenue you earn from your crude.?

DPR guidelines

A top management staff of DPR, when contacted, simply told Vanguard on telephone: ?I am not aware of any such huge approval.?
When prodded further, he added: ?What I know is that DPR recently released guidelines for the establishment of refineries, and we had road shows in Lagos, Port Harcourt and Abuja, to sensitise investors.?

Ordinarily, there are three levels of approval for setting up private greenfield (new) or modular refineries in the country.

They are Approval to Establish, LTE; Approval to Construct, ATC, and Licence to Operate, LTO.

An investor must overcome the requirements in each level of approval before proceeding to the next, as shown in the guidelines.
DPR had explained that the guidelines for the establishment of modular refineries in Nigeria was configured with the aim of shortening the approval time for licensing of refineries.

To woo investors to the project, DPR also reduced the licensing fee for new refineries from $1 million to $50,000. Government is desirous of refining at least 50 percent of its crude output in-country, not only to reduce import dependence, but also be an exporter of refined petroleum products.


Also confirming the development, a petroleum expert from the Emerald Energy Institute, University of Port Harcourt, Profesor Chijioke Nwaozuzu, said he was more concerned with the challenges for establishing such refineries.

According to him, such challenges are tied to political, land, funding, crude feedstock and market availability.

He said: ?These refineries are going to be located mainly in the Niger Delta, and the state governments may want to get involved because it is a high revenue earner, which grants only 28 days credit cycle.

?Also, refinery requires huge land, and there may be issues with acquisition from the land owners and to cap it all, refinery of any capacity requires huge capital. You need at least $30,000 per barrel, which is a huge sum even for a 1,000kbpd refinery.?
Feedstock? as in power sector

Furthermore, he noted that if Federal Government does not guarantee feedstock for those who complete the approval cycle, Nigeria may have a repeat of what happened with the initial 18 licences granted in the past.

Nwaozuzu, urged government to guarantee feedstock to the refineries, as it is doing with the existing 445,000 combined capacity four refineries, in addition to also guaranteeing the off-take of the products for the local market.



Former Nigerian President Obasanjo Declares Buhari as next Nigerian President

Started by internet police

Replies: 0
Views: 374
Last post March 04, 2015, 06:51:47 PM
by internet police
jonathan to buhari- If you want to probe me, then probe all the admin before me

Started by internet police

Replies: 0
Views: 542
Last post May 28, 2015, 01:26:23 AM
by internet police
Buhari shuts up rumour mongers , "I'm not dead" - Released dinner picture in UK

Started by legendguru

Replies: 0
Views: 451
Last post January 30, 2017, 05:01:31 PM
by legendguru
Man who promised to walk from Lagos to Abuja if Buhari wins arrived Abuja

Started by mastercode

Replies: 0
Views: 344
Last post April 21, 2015, 08:32:55 AM
by mastercode
President Obama Invites Nigerian President Buhari To White House

Started by admin

Replies: 0
Views: 333
Last post June 26, 2015, 09:17:55 AM
by admin
Buhari's first Nigerian President to stay at U.S President?s oficial guest house

Started by mastercode

Replies: 0
Views: 309
Last post July 20, 2015, 03:08:14 PM
by mastercode
Corruption versus corruption is impossible to fight?Jonathan?s aides tell Buhari

Started by yungcrux

Replies: 0
Views: 325
Last post October 15, 2015, 10:21:39 AM
by yungcrux
President Buhari remains Nigeria's president whether home or abroad ? Presidency

Started by yungcrux

Replies: 0
Views: 311
Last post March 14, 2016, 09:09:17 AM
by yungcrux
Nigeria Celebrate 57th Indepedence , Buhari Visits Maiduguri To Celebrate

Started by Nairaland

Replies: 0
Views: 450
Last post October 02, 2017, 12:36:37 AM
by Nairaland
President Obama reaffirms readiness to work with Nigeria President elect buhari

Started by admin

Replies: 0
Views: 356
Last post April 16, 2015, 02:51:33 PM
by admin