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Investors to Build two Refineries in P’Harcourt, Warri –NNPC

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modular refineries
  • Investors to Build two Refineries in P’Harcourt, Warri –NNPC

The Nigerian National Petroleum Corporation on Thursday said two private Nigerian companies had been selected to build two refineries in Port Harcourt and Warri under the co-location initiative of the Federal Government.

The co-location initiative, introduced by the Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, seeks to ensure that new refineries are set up to share infrastructure with the nation’s existing refineries in Port Harcourt, Kaduna and Warri, as part of measures to ramp up local refining capacity.

The Chief Operating Officer, Refining and Petrochemical, NNPC, Mr. Anibor Kragha, said at the AECN conference in Lagos, that the NNPC had identified two private companies that would build the refineries under the co-location initiative.

He said one of the companies, the LRR Group, would build 117,000 barrel per day refinery near the Warri refinery, while the other, identified as JALEMBA, would build 100,000 bpd refinery near the Port Harcourt refinery.

He said, “The reality of the situation is that studies have been done and by 2025, the actual projected petrol consumption in Nigeria is estimated to be about 41 million litres per day. Now, the three refineries at full capacity will deliver about 50 per cent of that. Dangote refinery, I understand, will deliver about 95 per cent of that when it comes on stream.

“That is where the whole idea of becoming a net exporter of petrol is coming from – if the three refineries operate at full capacity and Dangote also comes on stream,” Kragha said.

According to him, the NNPC is searching for financiers with technical expertise to rehabilitate the existing refineries within the next 24 months.

“On co-location, a 100,000 barrel per day refinery will be co-located in Port Harcourt refinery; there is also a 117,000 barrel per day in Warri,” he said.

The minister, in his keynote address, said the Federal Government was working out modalities to provide funding to promoters of modular refineries.

Kachikwu, who was represented by the Deputy Director in charge of Engineering Standard at the Department of Petroleum Resources, Mr. Olumide Adeleke, said funding was the major challenge hampering the effective take-off of the construction of the new refineries.

He said, “On the concept for co-location of refineries, we have moved from our initial model, which involved co-locating brownfield refineries with the existing refineries to the co-location of brand new (greenfield) refineries. The overall concept remains the same – pipelines, jetties, and where possible, storage tanks would be jointly invested in and shared.”

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Economy

Nigeria’s Plan to Review Oil Companies’ Gas Flaring Strategies

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Oil

Nigeria is ramping up its efforts to address environmental concerns in the oil and gas sector with a comprehensive plan to review gas flaring strategies of international and indigenous oil companies.

The Minister of State for Environment, Dr. Iziaq Salako, announced this initiative during a national stakeholders engagement meeting on methane mitigation and reduction held in Abuja, Investors King reports.

Gas flaring, a common practice in the oil industry, releases methane—a potent greenhouse gas—into the atmosphere, contributing to climate change and posing health risks to communities near oil facilities.

Nigeria aims to end routine gas flaring by 2030, aligning with global climate goals and commitments.

Dr. Salako explained the importance of reducing methane emissions and highlighted the detrimental effects on public health, food security, and economic development.

He outlined practical steps being taken to tackle methane emissions, including the development of methane guidelines and the engagement of government institutions.

The ministry, through the National Oil Spill Detection and Response Agency, will conduct periodic reviews of oil companies’ plans to ensure compliance with the gas flaring deadline.

Deloitte management consultants will assist in conducting comprehensive forensic audits to scrutinize the legitimacy of forward-contracted transactions.

President Bola Tinubu’s commitment to environmental sustainability underscores the government’s dedication to addressing climate change and fulfilling its multilateral environmental agreements.

The engagement event served as a platform for stakeholders to discuss methane mitigation strategies, existing policies, and implementation challenges.

Collaboration and dialogue among diverse sectors are crucial in charting a unified course towards sustainable methane reduction in Nigeria’s oil and gas industry.

As the country navigates its environmental agenda, ensuring accountability and transparency in gas flaring practices remains paramount for achieving a greener and healthier future.

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Economy

Interest Rate Jumps to 24.75% as CBN Takes Aggressive Stance Against Inflation

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Dr. Olayemi Michael Cardoso

The Central Bank of Nigeria (CBN) has announced a significant increase in the monetary policy rate, known as the interest rate, to 24.75%.

This move disclosed by CBN Governor Olayemi Cardoso during the 294th Meeting of the Monetary Policy Committee press briefing in Abuja, represents a bold step by the apex bank to address the mounting inflationary pressures faced by the country.

With inflation soaring to 31.70% in February, the CBN aims to moderate this upward trend by tightening its monetary policy stance.

This decision follows the previous hike in the interest rate to 22.75% in February, showcasing the CBN’s commitment to combatting inflationary forces.

While the bank opted to maintain the Cash Reserve Ratio at 45%, the significant increase in the interest rate underscores the urgency of the situation and the need for decisive action.

Governor Cardoso emphasized that these measures are essential to stabilize the economy and safeguard the purchasing power of the Nigerian currency.

The 294th MPC marks the second meeting under Governor Cardoso’s leadership, indicating a proactive approach to addressing economic challenges.

The next MPC meeting is scheduled for May 20th and 21st, 2024, highlighting the ongoing commitment of the CBN to navigate Nigeria’s economic landscape amidst inflationary pressures.

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Economy

Nigeria Braces for 10th Consecutive Interest Rate Hike by Central Bank

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Central Bank of Nigeria (CBN)

As Nigeria grapples with persistently high inflation, the Central Bank of Nigeria (CBN) is gearing up to implement its tenth consecutive interest rate hike in a bid to curb the soaring prices and attract investment.

Analysts surveyed by Bloomberg are anticipating a substantial 125 basis-point increase in the key rate to 24%, marking one of the most significant adjustments in the current tightening cycle.

The decision, expected to be announced by Governor Olayemi Cardoso on Tuesday at 2 p.m. in Abuja, comes on the heels of inflation accelerating to 31.7% in February, far surpassing the central bank’s target range of 9%.

This surge has been primarily attributed to the sharp depreciation of the naira, prompting authorities to devalue the currency twice since June to narrow the gap with the unofficial market rate and encourage investor confidence.

While these measures have seen the naira strengthen in recent days and bolstered investment inflows, including a fourfold increase in overseas remittances and significant foreign investor portfolio asset purchases, there remains a palpable need for more decisive action.

Giulia Pellegrini, a senior portfolio manager at Allianz Global Investors, emphasized the necessity for the CBN to intensify its tightening efforts to regain foreign investors’ confidence in the local bond market.

While acknowledging the positive strides made by the central bank, Pellegrini stressed the importance of a more assertive approach to prevent the diversion of investor attention to other frontier markets.

As the Nigerian economy navigates through these challenging times, the impending interest rate hike signals the CBN’s determination to address inflation head-on and foster a more stable economic environment.

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