The Nigeria National Petroleum Corporation on Thursday informed senators that the corporation could not afford the outrageous bills $1.3 billion for the maintenance of four refineries owned by the country.
The Corporation’s four refineries have not been able to produce optimally due to lack of maintenance. NNPC’s Coordinator, Corporate Planning and Strategy, Dr. Tim Okon, who appeared before the Senate Committee on Petroleum (Downstream), while giving account of the level of the country’s refineries, explained that when the Corporation invited the builders from Japan and Italy for turn around maintenance, the companies refused to come.
Okon said instead of the coming down for the maintenance, another company was recommended, SAIPEM, a foreign firm operating in Nigeria. Okon explained further that while the Port Harcourt and Kaduna refineries were built by two Japanese firms – Chioda and JGC – the Warri Refinery was built by Snapcogetti of Italy. According to him, when SAIPEM eventually came, it offered to maintain Port Harcourt Refineries at $550 million, Kaduna Refineries at $600 million and Warri Refinery at $180 million.
Okon said the bills were unacceptable to them because they were too high despite the fact that the figures were eventually reviewed downwards. He said the high bills prompted NNPC to send some of their engineers to the builders abroad to learn the repair processes with a view to saving costs. Following this move, Okon said NNPC began to spend as low as N10 million to maintain the refineries every month as from October 2014. Following this development, he said the four refineries would roar back to life and produce at optimum capacity from the first quarter of 2016.
Okon informed the lawmakers that the refineries were producing at 60,000 barrels per day as a result of maintenance problem but have the tendencies of producing 445,000 barrels of crude oil per day.
