State-Owned Refineries Must Run on NLNG Model for Sustainability

The Federal Government has been charged to divest some of its interest and ownership from the nation-owned refineries and allow the four refineries to run on the NLNG model for sustainable operations.

Under the NLNG model, the federal government represented by NNPC Ltd. has 49percent equity stake, while the private sector made up of Shell, TotalEnergies and Eni has 51 percent stake.

The Federal Government has also been urged to make deliberate efforts in developing local solutions to the challenges in the country’s oil and gas sector, as home-grown technologies and collaborations with the private sector was key to attaining sustainability in the industry.

These were some of the recommendations by experts at the just concluded 6th International Mid/Downstream Oil and Gas Conference organised by the Centre for Gas, Refining and Petrochemicals of the University of Port Harcourt, in collaboration with the Nigerian Society of Chemical Engineers, NSChE and Africa Centre of Excellence in Oilfield Chemicals Research.

A communique issued at the end of the conference, with the theme, Innovations for Sustainable Optimal Operations of Existing Oil and Gas Assets in Nigeria, also tasked the Federal Government to initiate policies that will ensure at least 60percent of equipment being used in the oil and gas industry are manufactured in Nigeria.

The communique jointly signed by the Vice Chancellor, University of Port Harcourt, Prof. Owunari Abraham Georgewill; Chairman of CGRP Board, Engr. Anthony Ogbuigwe; Acting Director of CGRP, Dr. Akuma Oji, and Chairman, Conference Planning Committee Prof. Ayoade Kuye, said government-private sector partnership in the mid and downstream sector can improve job creation, revenue generation, food security and national GDP.

According to the experts, these recommendations if implemented will usher in innovations for sustainable optimal operations of existing oil and gas assets in the country.

Some of the recommendations are, “

• Government must make deliberate policy to encourage the design and fabrication of oil and gas equipment in Nigeria. This is important because of its impact on the economy, job creation opportunities, as well as optimal and sustainable operation of the oil and gas industry.
• “The Federal Government of Nigeria should divest some of its ownership of the commercial refineries in Nigeria for a sustainable operation of the oil and gas industry; at least in line with the NLNG model i.e. 49percent Government and 51percent private sector, as only this will ensure sustainability.
• “All efforts should be expedited to ensure the optimal performance of all commercial refineries in Nigeria. These refineries can be upgraded with new technologies to increase capacity of production and quality of products.
• “There is need to ensure the standardization of products of gas, refining and petrochemicals in Nigeria especially the modular refineries to ensure sustainability.
• “More efforts should be targeted towards arresting the menace of crude oil pipeline vandalism, gas flaring and ensure turn-around maintenance of the commercial refineries in Nigeria as and when due.
• “Efforts should be made at increasing the consumption of fertilizer in Nigeria. Efforts at digitizing the operation and management of the oil and gas industry should be explored to drive the change in the downstream sector.
• “Nigeria like other African countries must pay adequate attention to targeted and sustainable financing of the downstream sector and the agricultural sector and policies made towards its actualization,” the experts said.