A Review of the Nigerian Energy Industry

NNPC to spend $600m on Warri Refinery TAM

03 April 2012, Sweetcrude, Warri – The Nigerian National Petroleum Corporation (NNPC) is rehabilitating the Warri Refinery and Petrochemical plant at a cost of $600 million (about N94.2 billion).

Mr. Samuel Babatunde, acting managing director of the Warri Refinery and Petrochemical Company (WRPC) – an NNPC subsidiary – made this known while receiving members of the Senate Committee on Petroleum (Downstream) at the company.

He told memberrs of the committee, led by its chairman, Senator Magnus Abe, that the Turn Around Maintenance (TAM) on the plant would commence any time from now as the company is set for the exercise, expected to last between 24 and 38 months.

Babatunde, who also doubles as the company’s Executive Director, Operations, said the Italian firm, Saipem, the original builder of the refinery, has been selected to handle the rehabilitation project.

But, he stated that “the $600 million figure is not sacrosanct; it’s just an estimated value,” as he hintted on a “two to three years programme to rehabilitate all the refineries in the country.”

Speaking on challenges confronting the company, the acting managing director referred to vandalism of and crude oil theft on the pipelines from Escravos as the most serious.

He said: “Only 40-50 per cent crude pumped from Escravos gets to the WRPC. The remaining are vandalised.
“In fact, in less than 30 minutes of pumping crude from Escravos, there is disruption in the system…The refineries are in terrible state of disrepair but some works are in progress.”

“We are victims of pipeline vandalism and disruptions…There is a running battle to keep our plants running at even 25 per cent; it’s a directive from Abuja,” he also lamented.

The Senate committee team included Abe; his deputy, Senator Danjuma Goje as well as Senators Abdulmumuni Hassan and Ibrahim Musa.

The Senate committee chairman, in his remarks, urged the management of WRPC to ensure that Nigerians get cheaper petroleum products by ending the culture of importation through efficient running of the local refineries.

He said: “Nigerians believe that as an oil-producing country, we shouldn’t be importing fuel. Nigerians don’t want to know about the mathematics of oil.

“All they are concerned with and all they are saying is that Nigeria has no business importing refined products. There are lots of expectations from Nigerians on these refineries and they are not being met.”

He maintained that any investment in the downstream sector will be a drain without a solution to the twin problem of pipeline vandalism and crude oil theft.

He added: “Taking fuel from Warri to Maiduguri by trucks is akin to taking them by ‘buckets.’ No economy can grow that way. We cannot do without the pipelines; this has nothing to do with oil. It has to do with our own survival as a country.

“A lot still has to be done with the challenges of our pipelines and crude oil theft.”
Commending the WRPC management for keeping the refinery going despite challenges, he referred to refineries as “critical national assets” and urged that government always invested in their maintenance.

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  • maik

    I hope you guys has gone to seek and obtain permission from the powers that be-I mean the oil/energy cabal- before embarking on this wild goose chase of a turn around maintanence?Because I dont believe these guys will want to see a Nigeria that does not import fuel and generators;a Nigeria where refineries are working at full capacity.