NNPC Considers Alternative Solutions as Turnaround Maintenance at Port Harcourt Refinery Stalls

The Nigerian National Petroleum Company (NNPC) Limited is grappling with significant setbacks in the rehabilitation of the Port Harcourt refinery, despite a series of assurances regarding its operational revival. Insiders disclosed that the ongoing turnaround maintenance has not progressed as expected.

The Port Harcourt Refining Company (PHRC) operates two facilities: an older plant with a capacity of 60,000 barrels per stream day (bpsd) and a newer one capable of processing 150,000 bpsd. This brings the total crude processing capacity of the refinery to 210,000 bpsd. However, since the federal executive council (FEC) allocated $1.5 billion for its rehabilitation in 2021, the refinery has remained non-functional, raising questions about the NNPC’s management of the project.

Insider sources report that various challenges are hampering the contractor’s ability to complete the revamp, including issues of obsolescence, corrosion, and a lack of baseline data necessary for structural integrity verification. Additionally, there is insufficient historical data on the facility, complicating the engineering process.

A Series of False Promises

The NNPC initially commenced repairs on May 6, 2021, with high hopes for a swift turnaround. However, a string of missed deadlines followed, including an announcement in December 2023 that the mechanical phase was complete. Minister of State for Petroleum Resources, Heineken Lokpobiri, stated production would begin after the Christmas holidays, but this timeline proved overly optimistic.

Despite repeated assurances from NNPC executives, including a statement in January 2024 that testing would be finalized within the month, the refinery has yet to yield any production. In March, NNPC’s Group Chief Executive Officer, Mele Kyari, promised production by the end of that month, but that also did not materialize. Most recently, Kyari indicated operations would begin in early August, yet the refinery remains idle.

Exploring Alternatives

Given the continued inoperability of the refinery, NNPC is reportedly considering alternative strategies to avoid prolonged stagnation. Documents obtained by TheCable suggest that one possibility is retrofitting the facility into a blending plant, which would involve mixing re-refined oil with additives to produce finished lubricant products. This option would not entail traditional refining capabilities.

A memo dated August 27 revealed communications between PHRC representatives and NNPC Trading Limited regarding the procurement of gasoline to blend with naphtha produced at the refinery. The request included specifications for high RON gasoline and outlined delivery plans for September and October.

Despite these developments, NNPC has publicly denied any intention to convert the refinery into a blending plant. Spokesperson Femi Soneye emphasized that such a move would not align with the company’s business model. He reiterated that the NNPC is committed to completing the commissioning of the old refinery, while rehabilitation efforts for the new facility are still ongoing.