A Review of the Nigerian Energy Industry

Pipeline vandalism big threat to refineries – Oniwon

18 January 2012, Sweetcrude, Abuja – The Group Managing Director of the Nigerian National Petroleum Corporation, NNPC, Austin Oniwon says the incessant incidence of pipeline vandalism is a big threat to the comprehensive capacity utilization of the nation’s refineries.

Mr. Oniwon made this known on Wednesday at the House of Representative Adhoc Committee monitoring the subsidy regime.

The NNPC helmsman condemned economic saboteurs who engaged in the vandalism of pipelines and appealed to the National Assembly to collaborate with the corporation in curbing the heinous crime, noting that pipeline vandalism is a strong disincentive to new investments in refineries.

“The regular incidence of pipeline vandalism across the country has hampered the efficient distribution of petroleum products. In December, 2011, we had to shut down the Port Harcourt refinery because the pipeline supplying crude to the refinery was severely vandalized,” Mr. Oniwon informed.

The NNPC helmsman said that if the pipelines are made to work, the bridging cost of N5.80k will not be borne by Nigerians and will go a long way in revamping the Pipeline Product Marketing Company depots across the country.

He said that the final investment decision on the three proposed Greenfield refineries in Lagos, Bayelsa and Kogi State will soon be reached, adding that this will make Nigeria self sufficient like other OPEC member countries .

On the Turn Around Maintenance of the three traditional refineries in Port Harcourt, Warri and Kaduna, Oniwon noted that the TAM contract would be awarded to the original builders of the refineries and upon completion, the plants will achieve 90 percent capacity utilization.

The GMD said that NNPC subsidy claim has progressively increased due mainly to the increase in price of crude in the international market adding that the corporation does not enjoy any form of discount in crude sold to it.

On the alleged illegal deductions from the federation account by the NNPC, Mr. Oniwon disclosed that the corporation operates within the framework of the law and the Act establishing it.

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