- The Nigerian National Petroleum Corporation (NNPC) has announced that it will adopt a new model to significantly reduce its cost of crude oil refining in the country.
- The oil corporation has decided to adopt a co-location model which will ensure new refineries are located within the same cluster to allow for sharing of major infrastructure like power, pipelines and other resources for refining. This was disclosed by the Group Managing Director, NNPC, Dr. Ibe Kachikwu in an interview with newsmen.
- Kachikwu explained that the new model will improve capacity efficiency in the petroleum industry.
He said, “The co-location model for the refineries is actually a proposal. I will like a situation where we will deal with our own existing refineries and then find individuals who are willing and ready to invest in other refineries.”
“In a co-located area, they (refineries) share common tanks, common pipelines, common power, and this will obviously bring down the cost of building refineries, and the effect of that is, if they are sharing technical skills and management together, there would be huge cost efficiency.
“We have to do our marketing very well and get people who are willing to do this.”
“Crude is cheap, and you need to refine to make some quick returns. There is the need for us to expand our refineries and grow more refineries and ship out refined products to the rest of Africa because there is a lot of market for them.
“Unfortunately, ours haven’t really worked and we need to get them to work,” he concluded.
