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NNPC boss blames failure of refineries on negligence, says there are no excuses 

The Group Managing Director of NNPC, Mele Kyari admitted that there is no excuse for the failure of Nigeria’s refinery to work.

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The Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Mele Kyari admitted that there is no excuse for the failure of Nigeria’s refinery to work. Instead, he chose to take the high road and blamed the failure of the moribund refineries on due negligence and bad maintenance culture.

This was his submission when he was asked a question about the NNPC’s technical capacity to properly manage oil exploration, refineries, and sales by the House of Representatives Committee on Petroleum (Upstream) in Abuja yesterday.

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[READ MORE: How NNPC discovered oil, gas deposits in the North]

The Details: Kyari said, The refineries didn’t fail because there were no skills. They failed because we are unable to take care of the refineries. And we don’t have to give excuses why we didn’t take care of them. But what we have decided to do is to make them work. There is no scarcity of skilled people.”

NNPC boss blames failure of refineries on negligence, says there are no excuses 

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Going forward, Kyari noted that Nigeria is actually skilled to make the oil sector work. He added that Nigerians are industrious as their contributions can be found everywhere in the global oil and industry. He also gave an assurance to make the refineries work, promising to put strategies in place.

The oil industry is a technology-based industry and this technology evolves every day. I can say that in the entire global oil and gas industry, there is nowhere you would have gone that you would not find a skilled Nigerian working in the oil and gas industry. And indeed, we are probably the largest contributor to skilled manpower in the industry of all the black nations of the world.

The will is there today and our plan is to get them to work. And I assure you that the plans we have in place will deliver these refineries. There is no issue around the absence of skills; we have the best refiners in the world. Anywhere you go in the world, they will attest to it that we have the best refiners who are Africans in this country,” he said.

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[READ ALSO: NNPC vows to be transparent, set to publish details of petroleum product supplies]

The setbacks: Despite a national target of three million barrels per day and 40 million barrels of reserves, the target has been elusive according to Kyari. He, however, pledged a commitment to the lawmakers to make sure that the target is attainable.

We are taking steps to realise this before the end of 2023, which is possible. A number of interventions are ongoing currently, including our elaborate intrusion into the frontier basins,” Kyari added.

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In recent Nairametrics articles, NNPC disclosed its decision to gain trust in the hearts of its stakeholders by publishing details of its petroleum products supplies. Part of the initiatives was the flag off of Operation white – a team of 89 persons inaugurated by the Federal Government to track fuel consumption in the country.

Patricia

Reincarnated as a lover of stocks, Angel investors, seed funds, and anything aligned to tech or startups raising money, Joseph's work at Nairametrics involves following the money to wherever it leads. Before joining Nairametrics, he won an investigative journalism fellowship with ICIR, appeared in several national dallies, with hard-hitting opinions, features and investigative pieces. He has also engaged in content marketing and copywriting for a top e-commerce firm in Nigeria.

3 Comments

3 Comments

  1. Daradara

    October 16, 2019 at 6:08 am

    Thats my problem with Nigerians. You have been a part of this ‘negligence’ all your life. You should just keep quite and work pls. We expect results, not blames.

  2. John christ

    October 16, 2019 at 9:00 am

    Part of our greatest undoing In our service system is when someone assumes a position of appointment, he works assiduously hard to cover truth with falsehood. This is exactly what the NNPC Boss did at the senate chambers some days ago regarding the moribund situation of our refineries. Take a look at the organoram of the refineries from 1999 and compare it with the present organoram of the refineries and it will suggest a systematic and deliberate arrangement to get the refineries where they are today. During the regime of Obasanjo, the refineries witnessed mass retirements of staff and since then the few remaining ones have been retiring in droves without a corresponding plan to engage new hands. I will suggest that any concern reporter or journalists should pay a visit and interact with the workers. How can a refinery survive with massive casualizations? We have over two thousand casuals in the three refineries combined. The few regular staff play god in the name of management. It got to a stage when a particular MD was behaving like a bull in a china shop and told everyone who cared to know that he was going to be the last MD in WRPC. This was during Jonathan’s time. Who are the best operators and technicians the NNPC Boss was boasting of? The are all casuals and he is very much aware of this. A tradition that has failed us over the years should be seen as a backward match and quickly jettisoned.

  3. Ishaku Ibrahim

    October 16, 2019 at 10:45 am

    The truth of the matter is this:
    1. High level of corruption in Nnpc will not make the refineries work.
    2. Political interference from governments will always lead to high cost of maintenance and poor quality delivery.
    3. Poor placement of staff to run the refineries due to tribal sentiment is another problem.
    4. Lack of proper cost benefit analysis in project management. This is common to all state owned assets.

    Way Forward

    Privatize the refineries.

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Coronavirus

FG announces schedule for 4th evacuation flight from the USA 

The evacuees will be expected to present an original COVID-19 negative test result not older than 14.

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flights, Nigeria sets conditions for border reopening, COVID-19: Nigerians in diaspora have not asked to be evacuated – FG, Attacks on Nigeria diplomatic residence, FG to engage Ghanaian government  

The Federal government has approved the fourth evacuation flight for Nigerians stranded in the United States of America for July 28.  

According to a statement that was signed by the Consulate General of Nigeria, the Ethiopian Airline with flight number ET509 will depart Newark Liberty International Airport, New Jersey on Tuesday 28 July 2020 by 21:15hrs and arrive Nnamdi Azikiwe International Airport, Abuja on Wednesday 29 July 2020 by 13:25hrs. 

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“All prospective evacuees duly registered with any of the three Nigerian missions in the USA should purchase their one-way tickets at a cost of $1250 for economy class and $2800 for business class for adult/child fare including all taxes with the usual percentage reduction for infants under 2 years,” the statement read. 

READ ALSO: FG acquires profiling robots for airport

In line with the earlier announced protocols from the Nigerian Presidential Task Force on COVID-19, the evacuees will be expected to present an original COVID-19 negative test result not older than 14 days on the day of departure at the airport. 

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There will also be a temperature check at the airport, and any intending evacuee with a body temperature above 38°c or any symptoms suggestive of COVID-19 will not be allowed to check-in. 

Evacuees are also required to wear a face mask as a matter of necessity and be in possession of hand sanitizer for intermittent use during the flight, while also adhering to the instructions of the  

Furthermore, all returnees are enjoined to adhere strictly to all instructions of Port Health Services (PHS) officials and observe other entry screening protocols on arrival. 

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Hospitality & Travel

Covid-19: British High Commission to resume visa application in Nigeria

Nigerians who want to visit the UK can do so as soon as international flight operations resume.

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Covid-19: British High Commission to Resume Visa Application in Nigeria

The British High Commission in Nigeria has announced plans to resume visa processing in the country. It revealed that it will soon begin receiving visa applications from Nigerians who want to travel to the United Kingdom (UK).

This was disclosed in a public statement by the British High Commission in Abuja on Thursday, July 9, 2020.

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It said that Nigerians who want to visit the United Kingdom can do so as soon as the international flight operations resume in the country. The statement said:

“We know there are many Nigerian nationals hoping to be able to travel to the UK when flights resume, both for employment and to see family members.

“UKVI are working closely with TSL contact, our commercial partner, to reopen visa application centres that were suspended due to COVID-19. UK visa application centres are reopening in phased manner globally when it is safe to do so and when we can operate an effective service.

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“TSL contact are putting appropriate measures in place and working hard to reopen in Nigeria. We will share details of when VACs will reopen soon,”

READ MORE: US to stop issuing visa for Birth Tourism 

It can be recalled that the Federal Government had shut down the airports to both domestic and international flight operations in March as part of measures to contain the spread of the coronavirus disease.

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Following the gradual resumption of domestic flight operations, Nigerians are expecting that international flight operations might be resuming soon.

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Commodities

Nigeria’s excess crude account falls to $72 million

Nigeria’s excess crude account has now fallen by a whopping 98% in just 5 years.

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Capital market to get more tax incentives - FG , FEC reviews Ajaokuta-Kaduna-Kano gas project contract, approves $2.571 billion, FG to reduce N1.5 trillion from 2020 budget due to coronavirus

Nigeria’s Excess Crude Account (ECA) now stands at $72 million as the country continues to grapple with an unprecedented revenue crisis not seen since the early eighties. The ECA account has now fallen by about 98% within the last 5 years.

The information on the excess crude account was revealed by the Minister of Finance, Zainab Ahmed in a National Economic Council Meeting during the week. The ECA is a savings account retained by the Federal Government and is funded by the difference between the market price of crude oil and the budgeted price of crude oil as contained in the appropriation bill.

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There were major concerns last November when it was reported that the ECA balances held just $324.5 million one of the lowest balances recorded at the time. At $72 million the ECA is in low territory highlighting the effect of the fall in crude oil prices this year. Crude oil prices have crashed to sub-zero in March and have risen back o just over $40/barrel in recent weeks. However, it still remains low from Nigeria’s previous budget benchmark.

ECA in the news

About a year ago Nairametrics reported Nigeria’s Excess Crude Account has dropped to $480 million. This is as controversy continues to trail the $1 billion military spendings which were withdrawn from Nigeria’s Excess Crude. According to the Central Bank of Nigeria’s annual report for 2018, Nigeria’s crude excess account fell from $2.45 billion in 2017 to $480 million as of December 2018.

(READ MORE: Rising COVID-19 cases in world’s biggest economy falter crude oil prices)

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Just 5 years ago (August 2015) the ECA stood at $2.2 billion. This was the early days of the Buhari administration. It was $3.6 billion in February 2014, one of the highest balances on record. That same month, at its monthly FAAC, the government agreed to remove fuel subsidy from its books. Fuel subsidy is currently being borne by the NNPC.

The Controversies: Last year, the federal government under President Muhammadu Buhari was accused of mismanaging the country’s Excess Crude Account especially the $1 billion reportedly spent on military equipment.

  • The National Security Adviser (NSA) retired Major General Babagana Monguno Gen. Babagana was quoted to have disclosed that he was not aware of the whereabouts or disbursement of the $1billion drawn from the ECA by the Buhari presidency in 2017 for security purposes.
  • While controversies trail the statement credited to the NSA, with many describing it as diversion of public funds, the Presidency provided some explanations.
  • Responding to the allegations, Senior Special Assistant on Media and Publicity, Garba Shehu, disclosed that various procurements had been made for the purchase of critical equipment for the Nigerian Army, the Nigerian Navy, and the Air Force, contrary to the allegations.

Nigeria’s ECA in retrospect: In Nigeria, there are two Sovereign Wealth Funds: the Excess Crude Account and the Nigeria Sovereign Investment Authority (NSIA). Note that these two are funded by the savings earned when oil prices are at peak.

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  • Hence, as a larger chunk of revenue is appropriated for ECA and NSIA, the country’s external reserves are likely to fall.
  • Note that the sovereign wealth fund was established to address the controversies surrounding the Excess Crude Account.
  • The fund is usually expected to generate revenue to meet budget shortfalls in the future, provide dedicated funding for the development of infrastructure and saves for future generations.

ECA depleted by 98% in 5 years: A closer look at the various annual reports of the Central Bank of Nigeria shows that Nigeria’s excess crude account has now fallen by a whopping 98% in just 5 years.

Patricia
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