The Senate has asked that serving and retired Staffs of the Nigerian National Petroleum Company Limited (NNPCL) account for the N11.3 trillion allegedly disbursed by the Federal Government on the turn-around maintenance of Nigeria’s refineries between 2010 and 2020.
The Senate also mandated its committee on Downstream sector to invite the NNPCL,Nigeria Upstream Petroleum Regulatory Commission (NUPRC) and Nigerian LNG Limited (LNG) to explain the nation’s preparation for Green Energy Sources in line with the Paris Agreement on Climate Change.
The Senate made the call while deliberating on a motion sponsored by Senator Karimi Sunday Steve (Kogi West) presided by Deputy President of the Senate, Senator Barau Jibrin in which it resolved to coopt a an Ad Hoc committee to investigate all Contracts awarded for the rehabilitation of all the State owned Refineries between 2010 and 2023.
The Senate ruled that despite all the huge funds spent to Revive the refineries there is nothing to show for. Calling on the NNPCL to account for the funds spent , the Senate noted that state owned Refineries in Nigeria have become a serious means of drain pipe of public finance, depriving the citizens of the joy of being an oil producing nation.
Statistically the Senate revealed that between 2010 to date Nigeria is estimated to have spent 11.35 trillion (N11, 349, 583, 166, 31340) excluding other cost in other currencies which include $892. 976, 050.00 dollar, 4, $77, 068.47 Euros and 3, 455, 656.93 pounds on renovation of refineries yet they are unproductive.
Due to the moribund state of the Nation’s refineries the Senate expressed regret that the Federal Government of Nigeria has spent over N6 Trillion Nalta between 2010 and 2020 on fuel subsidy due to Nigeria’s Low refining capacity.
The Senate further noted that the FG has spent almost twice the amount on rehabilitating (Turn Around Maintenance Projects) its Refineries in Port Harcourt, Kaduna and Wasti between 2010 and 2022.
Despite the moribund state of the four refineries the Senate noted that the operating costs of these refineries between 2010 and 2020 is estimated at N48 Trillion Naira. The refineries are estimated to make a cumulative loss of N1.66 Trillion, within 4 years.
Karimi in his lead debate the Federal Government of Nigeria has carried out rehabilitation projects in Port Harcourt Refinery Company (PHRC) over a period of seven (7) years from 2013-2019 at an estimated cost of N12, 162, 237, $11.61 only, in addition, on the 18th March 2021, a rehabilitation contract was executed between NNPC/PHRC and Tecnimont SPA at a Humongous sum of $1, 397, 000, 000.00 only (about N575 Billion Naira) amidst global public criticism.
Karimi gave more insights into the wasted funds;
“Phase 1 of the Project is expected to be completed in 28th Months after the contract, Phase 2 within 24 months and Phase 3 within 44 months of execution. Despite this, the Port Harcourt Refinery remains a money pit going by projections and representations from NNPCL the renovation works ought to be completed and operations of the Refinery commenced by June 2023.
“Perturbed that in a bid to revitalize the Warri Refinery, the Federal Government has injected huge public funds into revamping Warri Refinery & Petrochemical Company limited to the tune of over N28, 219, 110, 067.16 between 2014 and 2019.
“That particularly, around the 24th June 2022 the Federal Executive Awarded Maintenance Services for Quick Fix Repairs of Warri Refinery to Daewoo Engineering and Construction Limited at $497, 328, 500.00, yet at the moment the Warri Refinery is inactive.
Karimi disclosed further that the above is different from the 2017 contract award to Saipem Contracting Nigeria Limited for Tech Plant Survey of the Warri and Kaduna Refineries at 2, 025, 00032 Euros.
He said that it is mind boggling that the Kaduna Refinery and Petro-Chemical Company (KRPC) has over the past 10 years gulped N2, 266, 248, 434.00 in the name of rehabilitation, yet the Refinery remains unproductive.
“Nigerian National Petroleum Company Limited (NNPCL) approved a $741Million renovation deal with Daewoo Engineering and Construction Limited to renovate Kaduna Refinery in February 2023 and it is intended to restore the refinery to production of 110,000 barrels of petrol per day (at least 60 percent capacity) by early 2024 , Karimi said.
Calling for a thorough investigation of the past and current rehabilitation projects , Karimi expressed that if undertaken by the Senate, the circle of awarding unproductive turn around maintenance contracts may not abate, thereby retaining the status quo where rehabilitation contracts have become conduit pipes for siphoning public funds, whilst Nigerian citizens continue groaning over the high cost of petroleum products due to the moribund situation of the State owned Refineries, even as the World gravitates towards Green/Clean Energy sources.
In his contribution Senator Jibrin Isah queried how NNPC comes up with operating costs for moribund projects, he added that there are also lots of leakages in the NNPCL.
On his part Senator Adams Oshiomhole added that NNPC must be held accountable.
He said; “We will be doing justice to Nigerians. We hear that contracts are awarded but nothing is produced. NNPC must account for how much they have spent.
After contributions from majority of the Senators the Senate directed its committee on Downstream Petroleum to ascertain progress on the ongoing works in all refineries in order to forestall waste and corruption and to interrogate the Federal Ministry of Petroleum Resources, The NUPRC, NNPCL, BPE on the best approach to commercializing and/or ensuring profitability of the State owned Refineries.
SOURCE: sunnewsonline.com