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Allow illegal refineries to operate – Stakeholders urge FG

By on June 30, 2015

Stakeholders in the Nigerian oil and gas industry have urged the President Muhammadu Buhari-led administration to encourage more private sector players in the setting up and operation of new refineries across the country.

As part of the move, they asked the government to consider allowing some illegal refineries to start operating legally after they might have met global standards.

The stakeholders said this at a quarterly round-table programme organised by the Nigerian NewsDirect newspaper with the theme, ‘Setting agenda for the new government on private refineries, power supply, indigenous participation and financing.’

Government’s encouragement in this regard, they noted, would drive investment in private refineries in the country, while leading to refining of crude oil locally and guaranteeing the availability of refined products.

The Joint Military Task Force in the Niger Delta, Operation Pulo Shield, recently stated that it raided illegal distillation camps where it destroyed illegal refineries.

However, stakeholders who gathered at the forum said instead of the government destroying those refineries, it should rather provide an enabling environment that would encourage more investment in local refineries.

A former Commissioner for Finance, Osun State, Dr. Wale Bolorunduro, who was the guest speaker at the programme, said it was amazing that security agencies were still destroying illegal refineries in the country.

He said instead of destroying the refineries, the government should look at how the owners could be engaged for the benefit of the country.

Bolorunduro said, “I agree that it is illegal to own those refineries because they didn’t go through due process before they started their operations and I also believe that the destruction of those refineries will not be in the best interest of the country.

“What the government should do is to legalise those refineries. The government should look at how they can call the owners of those refineries together and see how the country can benefit from them.” Bolorunduro said.

Bolorunduro, who was represented by a Senior Special Adviser to the Osun State Governor, Mr. Ogini Kolawole, implored the Federal Government to create an enabling environment that would encourage investment in more private refineries in the country.

A former Executive Secretary, Petroleum Products Pricing Regulatory Agency, Dr. Oluwole Oluleye, said building of new refineries was one of the things that was talked about while setting up the PPPRA.

He implored the government to legalise the operations of the illegal refineries in the country.

Citing the refinery being built by the Dangote Group, Oluleye stated that whether the government continued with the payment of subsidy on refined products or not, Dangote had done the right thing, adding that the project would create jobs for Nigerians.

About 11 years ago, the Federal Government through the Department of Petroleum Resources licensed some private operators to set up 18 refineries in the country. Out of this number, according to the DPR, it is only Niger Delta Petroleum Refinery that is functioning and producing 1,000 barrels of crude oil per day.

Speaking on the failure of the other 17 private operators, the Head, Downstream Monitoring and Regulation, DPR, Mr. Maigida Mudei, said that lack of funds was one of the major reasons given by the operators for their inaction.

 

[Punch]