Embarrassment Looms as Refineries Risk Running Dry of Local Crude Oil Supply
The Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, has raised concerns about the availability of enough crude oil locally for the production of petroleum products by refineries and modular refineries in Nigeria. He emphasized that without an increase in production in the sector, these facilities may not receive adequate crude oil.
Speaking at the 2024 sector retreat for the ministry in Abuja, themed “Building Synergy for Enhanced Development in the Oil and Gas Sector,” the minister highlighted the potential challenge of insufficient feedstock for refineries, including Port Harcourt, Kaduna, Warri, Dangote, and BUA, after their rehabilitation.
Lokpobiri expressed his fear publicly for the third time in the last four months, reiterating his initial concerns raised in November 2023 during a ministerial retreat. He emphasized the need to ramp up production to meet revenue targets and obligations in the mid-stream and upstream sectors.
He stated, “One of the challenges I am afraid of is, if we finish fixing our refineries, we will be unable to get feedstocks. It will be very embarrassing that we finish Port Harcourt, Kaduna, Warri and Dangote and BUA and we don’t have feedstocks.”
Nigeria’s Dangote refinery, the largest in Africa, had planned in January to import crude from the United States due to supply concerns. Reports indicated that Trafigura Group sold 2 million barrels of WTI Midland to Dangote refinery for end-February delivery.
The minister’s warnings underscore the importance of addressing production challenges to ensure the smooth operation of refineries and modular refineries in Nigeria.
SaharaReporters
