Business
Amid Revamp Challenges, NNPC Mulls Sale of Warri, Porthacourt and Kaduna Refineries
The Nigerian National Petroleum Company Limited (NNPCLtd) is considering selling its refineries in Warri, Portharcourt, and Kaduna due to the complexities involved in revamping these facilities. According to Engr. Bayo Ojulari, Group Chief Executive Officer of NNPCLtd, the company has invested heavily in the refineries, but some of the technologies introduced have not yielded the expected results.
We’ve made quite a lot of investments in our refineries over the last several years and brought in a lot of technology, Ojulari said in an interview with Bloomberg. We’ve been challenged, and some of those technologies have not worked as expected so far.
The refineries, which have been abandoned for some time, are proving to be more complicated to revive than anticipated. As a result, NNPCLtd is reviewing its refinery strategies and will conclude the review by the end of the year. This review may lead to a change in approach, including the possibility of selling the refineries.
When asked about the potential sale of the refineries, Ojulari stated that while no final decision has been made, sale is not out of the question. All the options are on the table, he said, adding that the decision would be based on the outcome of the review.
Ojulari also highlighted the high operating costs of oil production in Nigeria, ranging between $20 and $30 per barrel. He attributed this to significant investments in pipeline security, which have resulted in 100% pipeline availability. However, he believes that with time and stability, these costs will decrease.
Despite the challenges, NNPCLtd is optimistic about increasing oil output. The company plans to boost production to 1.9 million barrels per day (bpd) by the end of the year. This target is part of NNPCLtd’s efforts to ramp up production, with a medium-term goal of reaching 2.06 million bpd by 2027.