Report has it that the Nigerian National Petroleum Corporation (NNPC) spent N218.18billion in 2019 for the refineries in the country (Kaduna Refining and Petrochemical Company, Port Harcourt Refining Company and Warri Refining and Petrochemical Company).
Out of the huge amount spent on the refineries, only N69.96billion revenue was generated from the refineries.
Nigeria is the largest oil producer in Africa (producing about 2million barrels of crude oil daily) with however just few refineries with combined capacity to refine 445,000 barrels per day.
Despite the shortfall, these refineries can only operate far below the capacity.
In 2019, the refineries had a combined total expenses of N218.18billion, but only generated N68.96billion as revenue out of the projected N309.14billion.
According to The Punch, figures obtained from Abuja showed that the refineries had projected a loss of N68.21billion in 2019, but however had N149.23billion as loss.
The Kaduna refinery had N58.96billion loss; Port Harcourt refinery had N44.77billion loss and the Warri refinery had N45.49billion loss in 2019.
According to The Punch, the NNPC had projected a cumulative monthly revenue of N25.76billion, an expense of N31.45billion and loss of N5.68billion for the refineries.
What is really shocking is how you confidently pump in huge amount of scarce resources into a business you already know would yield only losses.
May be former Vice President Atiku Abubakar was right about his plan to sell the refineries to private investors since their only use is to swallow our very scarce money.
According to The Punch, the refineries got crude oil valued at N80.74billion. The newspaper revealed that 4,084,560 barrels of crude oil valued at N80.74billion was supplied to the refineries for a period of 13 months.
For instance, it is reported that the refineries processed no crude oil in the month of November, 2019.
“In November 2019, the three refineries processed no crude and produced -5031 metric tonnes of finished products; comprising -3052MT and -1979MT utilised by the WRPC and the PHRC respectively,” the NNPC stated (as seen on The Punch).
“Combined yield efficiency is 0.00 per cent owing largely to ongoing rehabilitation work in the refineries. For the month of November 2019, the three refineries produced 385MT of intermediate products at combined capacity utilisation of 0.00 per cent.
“The intermediate product was primarily used by the PHRC. The declining operational performance recorded is attributable to ongoing revamping of the refineries which is expected to further enhance capacity utilisation once completed.”
Ogbodo ThankGod is currently the Managing Director/CEO/Group Chief Editor at Naija Buzz News Network. He was the Chief Editor at NaijaBuzz.News before his new top leadership role. Ogbodo has years of experience in the Nigeria Media Industry and has co-founded some media companies. He is the founder of Ogbodo Solution Nigeria and 1Push.Ng. He loves playing football and is a strong supporter of Lionel Messi who he describes as the greatest footballer of all time.