By: Osahon Femi
This
is the plan being considered in the presidency, the Federal
Government could supply crude to the local refineries at a reasonable price, as
an incentive to stop the current practice whereby the illegal refiners vandalize
and steal the crude. This concept would also prevent environment degradation
and trunk lines damage caused by spills.
The
idea being worked out will explore how some of the illegal refiners and
the local communities in the region can become shareholders in the proposed
Modular refineries concept of the Federal Government, presidency sources
disclosed.
A modular refinery is a refinery made up of smaller and mobile
parts- (skid-mounted, that are more easily fabricated and can be more quickly
transported to site. They come in different sizes with varying capacities
normally lower capacity than conventional refineries with more elaborate and
complication set-up.
The consideration going on now is subsequent to the promises made
by the Federal Government during the presidential interactive engagements in
several oil-producing States led by the Vice President Yemi Osinbajo to
integrate the illegal refiners, rather than a scorched-earth policy that seeks
to eliminate the operations of such refiners.
But sources explain that there are a number of significant hurdles
to be crossed especially issues around the engineering and technical
ramifications of such a conversion, besides figuring out the financial models
that would be workable and profitable.
However, specific consideration on how to integrate local
"illegal" refiners in the oil-producing communities into the Federal
Government's proposed modular refinery concept is now in progress with the
Presidency and the Nigeria Sovereign Investment Agency, NSIA, spear-heading
efforts.
At a meeting late last week at the Presidential Villa, issues
around technical and engineering implications of how to integrate the refiners
were discussed with industry experts and practitioners making presentations on
how to implement the Buhari presidency modular refinery initiative said to have
been first proposed by Dr. Ibe Kachikwu, the Minister of State for Petroleum
Resources.
At the meeting the experts reported that they have worked closely
with the NNPC, Oil & Gas operators, owners of marginal fields, operators of
refineries and various technical services providers "to develop a workable
system to develop this initiative," a presidency source disclosed.
Also, marginal field operators can also supply crude to the new
modular refineries that would have the illegal refiners integrated.
Presidency spokesperson Mr. Laolu Akande, confirmed that a meeting
was held last week on the issue adding that the Buhari presidency is actively
working on all fronts to speedily deliver on its promise of a 'new vision,' in
the Niger Delta.
Another important component of the plan under consideration is to
involve the current illegal refiners and their communities as shareholders
while the NDDC and the NSIA will also hold substantial holdings/equity
sufficient to make the smaller refineries operational as a business and a going
concern.
To facilitate effective community engagements, an MOU would be
established under the plan with the affected communities determining the
communities share, while the FG would supervise the implementation, which would
be driven largely by industry operators and the communities.
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