International investors who were supposed to provide funding for building roughly 20 modular refineries in Nigeria have deferred their contributions since it will be challenging to secure assurances regarding the supply of crude oil to the facilities once they are finished.
The international oil companies that make up the majority of Nigeria’s crude oil producers have not been able to convince investors that crude will be supplied to the modular refineries when the facilities are ready to produce refined petroleum products.
As a result, the facilities’ investors have held onto their money until the federal government can persuade IOCs to give the assurances necessary for modular refiners to get their crude oil supply.
Punch reported that there are now 25 modular refineries in Nigeria with licenses. There are five of them running and producing naphtha, black oil, kerosene, and diesel.
About ten are being completed in different phases, while the remaining ones have been granted licenses to open.
The publicity secretary of the Crude Oil Refinery Owners Association of Nigeria (CORAN), Eche Idoko, stated:
Idoko stated that the authorities did not want to assure the refineries because they think the funds may eventually not be utilised for building the refineries but selling the feedstock.
He added:
He said modular refiners as well as some downstream operators in the sector have repeatedly called on the regulator to mandate the international oil companies to supply crude to indigenous refiners first before exporting the commodity.
Idoko stated:
TimesNow.com.ng earlier reported that Aliko Dangote, chairman of the Dangote Group, lamented that international oil companies in Nigeria are not prepared to supply crude oil to his refinery with a capacity of 650,000 barrels.
In a CNN interview, Dangote claimed that the multinational oil corporations were accustomed to selling crude for foreign exchange.
He added that despite the Nigerian National Petroleum Company Ltd’s best efforts, the IOCs prefer to sell their products abroad.
Proofreading by James Ojo Adakole, journalist and copy editor at TimesNow.com.ng.
Source: TimesNow.com.ng
