The NNPC in defending it’s budget at the National Assembly has revealed negotiations are on going for the TAM of the Kaduna, Port Harcourt and Warri Refineries. The Coordinator, Corporate Planning, and Strategy of the NNPC, Dr. Tim Okon, told the Senate Committee on Petroleum Resources (Downstream), in Abuja;
Okon said: “The refineries would work again at full capacity, we already have plans to bring them back to perform at full capacity.
He added that Saipem which was to carry out the TAM of the Port Harcourt refinery gave the agency a bill of $475m, but later reduced it to $297million after further negotiation.
He said the management considered the prices to be high and decided to look inward by inviting local contractors that are familiar with the facilities and worked with them.
He said, “Going forward, we have been able to reduce the cost of doing the TAM from $550m to $152million.
“We did a similar analysis for the Warri refinery and we brought it down to $180m from the $850million requested by Saipem.
“For the Kaduna refinery it was reduced from $600million to $212million.
“So we have been able to reduce the total cost of the TAM for the refineries to $550million.
“The exercise which started in October last year is for a period of 18 months and it will be completed in the first quarter of next year.
“The expenditure of $16million a month had been reduced to an average of $10million a month per a refinery.
“By the first quarter of next year, all the refineries will be functioning optimally and we would be able to refine an average of 400,000 barrels of crude oil per day for local consumption.
“However, another advantage of what we are currently doing is that instead of shutting down the facilities while the TAM lasted, we will be producing even when the rehabilitation work is ongoing.
