For several years, Nigeria’s refinery stood as a mute testament to the nation’s paradox, a nation rich in crude oil yet impoverished by its inability to refine it. The cost of this paradox has been staggering and utterly embarrassing, to put it mildly.
The nation’s four state-owned refineries, symbols of squandered potential have faltered, leaving Nigeria to import over 80 per cent of its refined petroleum products at staggering costs exceeding $2 billion annually. This dependency has strained foreign reserves, exacerbated inflation, and amplified the agony of citizens grappling with exorbitant pump prices of premium motor spirit (PMS) and diesel.
Even with the activation of the Dangote Refinery, a private player with the acclaimed capacity to process 650,000 barrels of crude daily, fuel costs have remained abominable.
Across the federation, pump prices hover at N1,100–N1,300 per litre, with some states reporting higher prices due to transportation costs. This surge, exacerbated by inflationary pressures, has crippled the nation’s economy.
Fuel costs have a cascading effect. Transportation costs have soared, spiraling into higher prices of food, basic provisions and essential commodities. Bread, rice, and garri, staples of the Nigerian diet have become luxuries for many. Likewise, tomatoes, pepper, and hitherto affordable fruits.
Commuters endure skyrocketing fares, market women watch their profit margins erode under-inflated transport costs, and as the prices spiral beyond reach, families struggle to afford a decent meal.
For the average citizen, the oil beneath their feet has become a curse, not a blessing.
Importing refined petroleum products also drained billions of dollars from the national coffers annually, and grossly depleted foreign reserves and exposed the populace to the volatility of global markets, worst of it was the fuel subsidy regime which was literally put into extinction in 2023 by the visionary leadership of President Bola Ahmed Tinubu GCFR. However, the Nigeria National Petroleum Company Limited (NNPCL) under the current Group CEO, Engineer Mele Kyari, who obviously broke the jinx of fruitfulness and hopelessness by bringing back on stream the Port Harcourt Refinery on Tuesday November 26, 2024 has not only written his name in gold but has clearly shown tenacity, patriotism and commitment to drive and sustain the purpose-driven mantra of President Tinubu which is hinged on renewed hope agenda. Indeed this latest milestone will ultimately reduce pressure on foreign exchange and bring down importation of refined petroleum products to the country thereby mitigating hardship and hunger in the land.
The resurrection of the Port Harcourt Refinery was heralded as a masterstroke in addressing the woes of Nigeria, a monumental achievement akin to thev revival of a phoenix from its ashes.
While reacting to some vituperative criticisms on the spurious claim that the NNPCL instead bought “Cracked C5 petroleum resins” and blended it with other products, including naphtha to sell to the Nigerian public as though the refinery processed it, the Chief Corporate Communications Officer, CCCO of NNPCL, Olufemi Soneye set the record straight and solid when he said “refining and blending are interconnected processes crucial for crude oil processing and optimizing refinery yields, especially when producing Premium Motor Spirit (PMS).
PMS is not a single product but a carefully crafted blend of various refinery outputs, including naphtha, reformate, pentane-plus hydrocarbons, and other middle distillates, designed to enhance value and meet consumer needs.
“Blending operations are standard in refineries worldwide, with the process and ratios varying based on factors like crude oil type, refinery configuration, and specific fuel requirements (e.g., octane rating or sulfur content). Don’t be swayed by individuals misusing technical terms they don’t fully understand to spread misinformation or hinder progress. Blending and refining remain essential and sophisticated components of modern fuel production. We are not blending SRG with Napthat. SRG is blended with Crack C5. Yes, it is normal practice to blend SRG with Crack C5.
“Straight-run gasoline blended with cracked C5 refers to a mix of two distinct gasoline components, typically aimed at optimizing fuel quality and meeting market specifications. SRG is often blended with higher-octane components such as crack C5 to create commercially viable gasoline. C5 is derived from fluid catalytic cracking (FCC) processes, specifically from the lighter fractions of the cracked products. Our FCC is in the New PH refinery, and it is undergoing construction. Blending takes place in the FCC which is normal operation practice. Cracked C5 compensates for the low octane rating of straight-run gasoline, making the blend suitable for modern engines.”
On the issue of cause of delay on the facility and the unprecedented breakthrough was recorded the NNPCL spokesman equally made some lucid clarifications:
“Execution of a revamp project in a brown field environment has a greater technical difficulty which is multiple times higher than in a green field. Unknown and unforeseen technical challenges impeded the commissioning and startup multiple times and took us back several weeks hence schedule delays.
“We partnered with and drew on the wealth of experience from an external party who had carried out commissioning and startup, currently operating and maintaining several refineries. The injection of these additional, highly skilled and competent resources was the game changer. We also identified and mobilised retired NNPC staff who had worked in the refineries, their experience and expertise were useful. We carried out a detailed technical review to understand and identify areas of vulnerabilities; we put a system in place to eliminate and address the bad actors systematically.”
It is now crystal clear that the Group CEO of NNPCL, Engineer Mele Kyari is obviously returning the entire Nigeria’s petroleum industry value chain back into its days of glory and times when it contributed massively to the petroleum product pool of the country. This will no doubt reduce dependency on imported products and reinforce the availability of products locally all years round.
He is known not just for fighting oil theft like never before, but also prospecting for, and discovering oil in the northern part of Nigeria with numerous positive gains. He has brought peace to the Niger Delta. He has stopped the business-as-usual syndrome in the industry. Kyari is surely not the first GCEO of the NNPCL, but he has certainly proven himself to be the best, using his vast wealth of experience to revolutionise the oil and gas sector, showing exemplary, unique and rare leadership style. These qualities fully explain all the efforts, sacrifices, transparency, the GCEO is making to transform the oil and gas sector to a standard that can stand the challenges of this present time.
Indeed, with Kyari, the dream, hope and vision of leading the oil and gas sector in the continent and around the world is not only alive but also yielding positive and remarkable socio-economic effects.
Olatunji, a banker, sent this piece from Abuja
