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                      Nigeria: House of Representatives commends NNPC over rehabilitation work, progress at PH refinery

                      Public Sector Global by Public Sector Global
                      December 20, 2021
                      in Featured, NEWS
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                      Nigeria: House of Representatives commends NNPC over rehabilitation work, progress at PH refinery
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                      Chairman, House of Representatives Committee on Petroleum, Downstream, Rep. Abdullahi Gaya has expressed optimism that rehabilitation of Port Harcourt Refining Company (PHRC) plants by the Nigerian National Petroleum Company (NNPC) Limited would be completed on schedule.

                      Speaking during an oversight visit of the Committee Members to the refinery, Gaya said the visit was necessitated by the need for the lawmakers to assess firsthand the level and quality of work done so far.

                      This, he said was to ensure that there was value for money in the execution of the project.

                      Gaya said that members of the Committee also wanted to ascertain if the work was progressing according to timelines to facilitate timely completion of the project and to check if there was need for further intervention for the general benefit of the nation.

                      He said that the committee was excited at the appreciable level of activity going on in the plant, especially when compared to level of work during the committee’s visit in 2020.

                      The Committee Chairman said that with the Petroleum Industry Act (PIA) now in force, and the presidential directive for its full implementation within a year, it is expected that the downstream sector would now be independent.

                      Earlier, the Managing Director, PHRC, Ahmed Dikko, who took members of the committee on a tour of the plants, said the rehabilitation project was aimed at restoring the plant to a minimum of 90 per cent nameplate capacity utilisation.

                      According to the MD, the scope of the rehabilitation project which will last for 44 months cuts across Process Areas 1, 2, 3 (NPHR) and 5 (OPHR); Power Plant and Utilities; Offsites; Jetty; Wastewater Treatment Plant; Distributed Control System (DCS); Emergency Shut Down (ESD) and Fire & Gas System (FGS); Technical Buildings; Non-Technical Buildings and Pipelines Repairs, etc.

                      On Health Safety and Environment (HSE) statistics, Dikko said that over 150,000 man-hours have already been achieved on the project with zero lost time injury, zero fatality and zero damage to property.

                      The Managing Director also informed the lawmakers that the contractor was complying with the provisions of the Nigerian Content Development Act as there was active participation of Nigerian companies as sub-contractors in the project.

                      Furthermore, he said MoU was signed between the contractor and the Community Leaders to boost cordial relationship between the company and the host communities, detailing expectations by the communities from the contractor.

                      Dikko said there was zero unrest so far due to the robust community relation engagement between Owner/Contractor and the host communities.

                      The PHRC Rehabilitation is in three phases.

                      The First Phase is the Old Refinery, Area 5 scheduled to be completed in April 2023.

                      The Second Phase is Area 1 and 2 scheduled to be completed in December 2023 and the Phase 11 scheduled to be completed by December, 2024.

                      Meanwhile, NNPC has pledged to increase supply of Liquefied Petroleum Gas (LPG), also known as cooking gas, in order to bring down its price across the country

                      The Group Managing Director (GMD)/Chief Executive Officer (CEO) of the NNPC, Malam Mele Kyari, announced this at the inauguration of a 120-metric tonnes LPG storage and bottling plant by Emadeb Energy Services Limited in Abuja.

                      He, however, explained that the hike in cooking gas price is international issue.

                      Kyari said the commissioned plant would help to reduce the cost of energy since LPG was cheaper than any other alternative fuel.

                      He stressed that the Federal Government was committed to providing gas for its citizenry.

                      The Managing Director/Chief Executive Officer, Emadeb Energy Services, Mr Adebowale Olujimi, urged the government to support LPG investors considering the capital intensive nature of the sector.

                      In the meantime, the GMD of NNPC, Malam Mele Kyari, has tasked the management of the National Engineering and Technical Company (NETCO) to take advantage of the opportunities provided by the PIA to increase its profitability.

                      Kyari gave the charge at a two-day Management Retreat organised by NETCO in Lagos with the theme: “Repositioning NETCO for Growth and Profitability in PIA Times”.

                      He noted that NETCO and other subsidiaries of the NNPC must key into the new mandate of the organisation following the signing of the PIA by President Muhammadu Buhari on Aug. 16, 2021

                      The NNPC helmsman said the national oil company has been transformed into a more competitive and commercial entity which would continue to deliver value and dividends to its shareholders.

                      He said the oil and gas industry was facing huge challenges due to the COVID-19 pandemic and the global energy transition which has reduced investment in the upstream sector.

                      Kyari, however, noted that the PIA had provided a lot of opportunities to attract investment to the sector which NETCO and other NNPC subsidiaries should take advantage of to increase their profitability.

                      Also speaking, the Group Executive Director, Downstream of the NNPC and Board Chairman, NETCO, Adeyemi Adetunji, said that the PIA had codified the regulatory, administrative and fiscal framework for the industry.

                      He said NETCO’s involvement in the NNPC refinery rehabilitation project had put the company on the world map as one of the reputable companies in refinery rehabilitation.

                      On his part, the Managing Director of NETCO, Johnson Awoyomi, said the retreat was aimed at brainstorming on how to move the company forward in the PIA era.

                      Awoyomi noted that to align with the reality of the Act, NETCO would focus on cost optimisation in project execution and expand its business portfolio through diversification into other viable sectors of the oil and gas industry.

                      He said that the company would also intensify construction management activities, technical collaboration to expand its business frontiers and seek more opportunities outside of NNPC, within Nigeria and overseas.

                      The MD, who commended the leadership ability of the NNPC GMD, said the declaration of N287 billion profit in 2020 by the corporation was a testimony to the management’s cost effective initiatives.

                      The Executive Director, Operations, Mr Kanayo Odoe and his counterpart, Executive Director, Services, Mr Ahmad Kigo, also spoke about the retreat.

                      Still in the week under review, the NNPC Limited recorded ₦141.96billion trading surplus for June 2021, compared to a deficit of ₦37.46Billion in May 2021.

                      This huge leap was contained in the June 2021 Monthly Financial and Operations Report (MFOR) of the company.

                      A trading surplus or trading deficit is derived after deduction of the expenditure profile from the revenue for the period under review.

                      In June 2021, NNPC Group operating revenue as compared to May 2021, decreased by 9.07 per cent or N89.27billion to stand at N894.64billion.

                      Similarly, expenditure for the month decreased by 29.32 per cent or N299.44billion to stand at N721.93billion.

                      Thus, in the period under review, expenditure as a proportion of revenue was 0.81 per cent compared to the figure in May which stood at 1.04 per cent.

                      The report also indicated that the increase in trading surplus was due mainly to the increased sales of crude oil and gas by the Nigerian Petroleum Development Company (NPDC), an upstream subsidiary of the NNPC, and the increased gas sales and depreciation postings by the Nigerian Gas Company (NGC).

                      The positive outlook was further bolstered by the performance of Duke Oil and the Nigerian Gas Marketing Company (NGMC) which also added to the improved bottom line.

                      Trading surplus or trading deficit is derived after deduction of the expenditure profile from the revenue for the period under review.

                      According to the report, plus or trading deficit is derived after deduction of the expenditure profile from the revenue for the period under review.

                      To ensure continuous supply and effective distribution of petrol across the country, a total of 1.63bn litres of PMS translating to 54.50mn liters/day were supplied in June 2021.

                      In June 2021, 47 pipeline points were vandalised representing 26.56 per cent decrease from the 64 points recorded in May 2021.

                      Port Harcourt Area accounted for 43 per cent, while Mosimi and Kaduna Areas accounted for 51 per cent and 6 per cent respectively of the vandalised points.

                      In the gas sector, a total of 223.77billion cubic feet (bcf) of natural gas was produced in the month of June 2021 translating to an average daily production of 7,459.88million standard cubic feet per day (mmscfd).

                      The 71st edition of the MFOR highlights NNPC’s activities for the period of June 2020 to June 2021.

                      In line with its commitment to transparency and accountability, NNPC had continued to sustain effective communication with stakeholders through this report via publications on its website, independent online news portals and in national dailies.

                      Also in the week, the Minister of State for Petroleum Resources, Chief Timpre Sylva charged members of the PIA Implementation working Group not to rest on their oars in the execution of their mandate.

                      Speaking at the formal inauguration of the group which commenced work immediately after the Presidential accent of the PIA on Aug. 16, 2021, Chief Sylva said that the team must work had to deliver the desired outcome on schedule.

                      The PIA Implementation working Group which is an offshoot of the PIA Steering Committee is headed by Dr Bello Gusau, the Executive Secretary, Petroleum Technology Development Fund, with members drawn from the agencies and parastatals of the Federal Ministry of Petroleum Resources.

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