04 February 2014, Lagos — Oil workers, under the aegis of Petroleum and Natural Gas Senior Staff Association of Nigeria, PENGASSAN, have expressed concern over the inability of the Federal Government to build additional refineries over the years, saying Nigeria’s crude output for 16 days is capable of building a refinery.
“To build a refinery today is about US$4 billion (N640 billion). We produce not less than 2.4 million barrel of crude oil on a daily basis and we sell at $108, which is the price all over the world. Going by that calculation, we are making about N41.2 billion daily,” Mr. Folorunsho Ogini, Chairman, PENGASSAN, Lagos Zone, said in an interview with Vanguard.
Delay in passage of PIB
He lamented the delay in the passage of the Petroleum Industry Bill, saying that the Bill, if passed, will address a number of challenges currently confronting Nigeria’s oil and gas sector.
He said: “The question is; why is the PIB not signed into law? Who is afraid of the PIB? These people know quite well that if PIB is signed into law, all these problems confronting the nation’s oil and gas sector have been addressed by the bill.
“These refineries we are talking about, they were built pre-1989 and those who built the refineries recently declared that the technologies used in those refineries had been phased out. What is stopping us from building more refineries?
“The next question you will ask is, where is this money going? When you look at our roads, it is nothing to write home about. In the issue of Education, you are living witnesses to when lecturers went on strike for over five months. Electricity; we do not have and infrastructure generally, in every ramification, you cannot equate us with ordinary Ghana.
“The question that is begging for an answer is, if you are making over N41 billion daily, why is poverty still ravaging the country? We have the capacity to produce more than 2.4 million barrels per day, but because of the ceiling by the Organisation of Petroleum Export Countries, OPEC, which we are a member.
The Singapore experience
“Singapore is a country that does not have crude oil, they import, yet they have about 62 refineries. They buy the crude, refine and make huge profit. Why is that Nigeria, that has the crude and the manpower is wasting because we cannot build refineries.”
Kicks against sale of refineries
Ogini disclosed that PENGASSAN’s decision to kick against the sale of the refineries was based on its realisation that the PIB has already taken into consideration all that is needed for our refineries to work and the fact that a Turn Around Maintenance, TAM, has already been scheduled.
He said: “What many people do not know is that, the PIB has already taken into consideration all that is needed for our refineries to work and be a success story. Do you know what, we discovered that government wanted to rush the sale of the refineries because all the spare parts for the TAM are already in the ship coming to Nigeria and will arrive at any moment?
“That was why some people were pressuring government to sell the refineries as scraps so that when the spare parts come, they would take the spare parts to do the TAM and tell Nigerians that they have done the magic and that the refineries are now working.
Turn Around Maintenance
“We have been talking about TAM for more than 10 years. Late General Sani Abacha awarded the contract twice for the TAM, but nobody did anything in spite the fact that the contract sum was paid. Till today, government has not apprehended anybody.
“We insisted that no, you cannot sell the refineries, you must wait for the spare parts to come, do the TAM and let us see what would happen next. Because they are people that want to rip off the nation from the sale, they were pressuring the government.”
– Michael Eboh, Vanguard