By the end of July, the Nigerian National Petroleum Corporation (NNPC) would have finalised preparations to award rehabilitation contracts for the 110,000 barrels per day (b/d) Kaduna and 125,000 barrels per day (b/d) Warri refineries.
Mallam Mele Kyari, NNPC’s Group Managing Director, stated that the company plans to sign Engineering, Procurement, and Construction (EPC) contracts for the facilities within the next three weeks.
As previously announced, the NNPC would not utilise government funds to rehabilitate the refineries instead, it will obtain bank loans and repay them with the cash flows generated by the facilities.
According to Mallam Kyari, a similar approach will be used to negotiate the purchase of a 20% stake in Dangote’s 600,000 b/d refinery. Lenders are taking a look at the project, which is expected to start producing in 2022.
He said: “As the national oil company of the country we have the responsibility to guarantee energy security.”
“[it would be impossible for] any country to watch a business of this magnitude and sensitivity to run without the involvement of a national company.”
“They are cheaper and faster to construct and they will also take off the burden of the Opec+ crude output restrictions.”
The NNPC is also considering building five condensate refineries as a cheaper alternative to producing light-end products. Within the next three months, NNPC hopes to make final investment decisions on two projects with a total condensate refining capacity of 200,000 b/d.