The federal government has put to rest insinuations that it was in the process of legalising the business of illegal refining of crude oil in the Niger Delta region.
It described the belief in some quarters, especially by ex-militants, as one of the general misconceptions of the host communities and members of the public, noting that there was also the wrong perception that the federal government would build modular refineries for host communities to operate.
Speaking at a workshop in Port Harcourt organised for civil society organisations and select media houses in the region by the office of the vice president, Senior Technical Adviser to the Minister of State for Petroleum Resources on Refineries and Downstream Infrastructure, Rabiu Suleiman, said there was also the wrong notion that the federal government would sell crude oil to the refineries at discounted rates.
He said: “There is the general misconception of the host communities and the public that the federal government plans to legalise the activities of artisanal refineries (or) that the government was going to construct modular refineries and hand them over to the communities to operate.
“And that there will be crude oil allocation to cover 60 percent of the refineries installed capacity; and also that crude oil will be sold at the discounted price or that the investors would be the preferred bidder for oil block allocation.
“That they will have crude oil lifting rights, and that immediately licences are granted to establish, they will start lifting crude oil to the refinery.
“It is not the intention of the federal government to legalise the ‘illegal’ refiners.”
According to Suleiman, an audit of 44 existing refineries licences holders in July 2018 revealed a general poor performance.
“From DPR’s records, over 40 percent of these licences granted have expired; project owners are unable to progress their respective projects mostly attributed to funding constraints,” he added.
He explained that out of the 10 licenced projects identified for possible groundbreaking, two refinery projects had commenced construction, namely: the Niger Delta Petroleum Resources with an additional 10,000bpd Modular Refinery in Ogbele, Rivers State. and OPAC Refineries-to establish 7,000bpd refinery in Umuseti, Kwale, Delta State (phase one) with an expected inauguration date of December 2018.
