The Crude Oil Refinery-owners Association of Nigeria (CORAN) has said Nigeria is gradually becoming a refining hub in West Africa but complained that already established refineries face supply challenges.
The association said this as it welcomes the licensing of a new private refinery in Delta State by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA).
NMDPRA announced on its X page earlier this week that it had issued a license for the construction of a 10,000 barrels per day refinery in the Ughelli area of Delta State to MRO Energy Limited.
“The authority Chief Executive, Farouk Ahmed presented a License to Establish a 10,000 Barrels Per Stream Day Refinery at Imode in Ughelli, Delta State, to MRO Energy Limited,” the agency announced.
In an exclusive chat with Nairametrics, CORAN Publicity Secretary, Eche Idoko, said the association welcomes the anticipated addition but stressed the need for the government to address the persistent supply challenges faced by local refineries.
- He noted that Nigeria is becoming a refining hub in West Africa with the addition of the Dangote Refinery and other private and state-owned refineries.
- He also stated that the growing number of refineries in Nigeria would influence the pricing and supply of petroleum products globally, a development that would make “Nigeria a reference point in the global Petroleum Market.”
“Just like Rotterdam (in the United States) is a reference point when it comes to refining in the world, we (Nigeria) can become a reference point as well,”
He expressed optimism that Nigeria would become an export hub of refined petroleum products rather than depending on importation.
“We are committed to how we can transform Nigeria from an import-dependent country to an export hub in Africa.
“And the good thing is that we are seeing the trend already. You can see how Dangote is influencing prices globally.”
NMDPRA reduced the licensing fee last year
Idoko commended the Midstream regulatory authority for its effort to encourage the establishment of local refineries in Nigeria.
- He revealed the agency reduced the licensing fee of new refineries last year
- He said the gesture, as well as other initiatives of the Federal government to boost the downstream sector, is yielding positive results.
“One of the major things NMDPRA did was to cut the cost of licensing for establishment of refineries,” he noted.
Crude supply still not easily accessible
However, despite the growing number of refineries in the country, Idoko lamented that the Federal Government is not living up to its promise of making crude oil easily accessible to local refiners.
- He said the Nigeria National Petroleum Company Limited has failed to meet the demands of local refineries who struggle to get supplies.
- He also disclosed that the Naira-for-crude initiative of President Bola Tinubu has stopped and local refineries, supplies under the initiative.
“However, the issue of crude supply is still something that needs to be addressed. As I speak to you, none of the modular refineries are getting crude supplies from the government not to talk of getting it with Naira. Also, the crude for Naira initiative of the President has stopped as I speak to you.”
What you should know
- MRO Energy Ltd is an indigenous firm that provides energy solutions in the areas of petroleum engineering, project management, and solutions.
- Last year the NMDPRA issued a license to another indigenous firm, Process Design and Development Limited for the construction of a 27,000-barrels-per-day refinery in the Akko area of Gombe State.
- There are currently nine operational refineries in Nigeria, according to data from the Nigeria Upstream Petroleum Regulatory Commission, all with a refining capacity of less than one million barrels per day.
