Bravo to arrival of old Port Harcourt Refinery

“The journey of a thousand miles starts with one step” is a popular saying with origins in a Chinese proverb; so, here we are! Energy scarcity and its crises have visited and dealt very terrible and painful blows on Nigerians generally. It has seriously bedevilled the country’s economy for the past three decades. The common man in the street has had a full dose of the sufferings brought by the economic hardship, the consequence of petroleum product scarcity that has lasted since the 1990s. As one reminisces, it is actually an excitement over a small nameplate capacity crude oil refining facility (just 60,000 barrels per day) that was Nigeria’s first, established in 1965 at the same time as a similar plant in Côte d’Ivoire that is still functional till date. This facility can only service about 10 percent of about 40 million litres of PMS, the nation’s daily domestic petrol needs (a critical and effective consumption estimate). But the secret behind the joyous mood is that the jinx has finally been broken. According to the information disclosed by Ibrahim Onoja, the managing director of NNPCL Port Harcourt Refinery, who emphatically gave assurances to deliver the old refinery being rehabilitated, the facility will be operational starting from this December 2023.

Recall that in April 2021 the multilateral development financial institution the African Export Import Bank (AFREXIMBANK) gave a loan of $1.5 billion to NNPCL for the rehabilitation of the two refining facilities located in Port Harcourt (the old refinery and the Elesa-Eleme petrochemical refinery of 150,000 bpd capacity).

The local refining and distribution of processed crude oil has all these years sounded like a fairytale that is difficult to believe, nor were products realisable as this too, always appeared like a mirage. The national oil company (NOC), Nigerian National Petroleum Company Limited (NNPCL), had formed the permanent habit  of giving unending reports on the status of the four government refining facilities with a combined 445,000 bpd capacity, located at Port Harcourt, Warri and Kaduna. If Onoja’s briefing is anything to go by and it becomes a reality, having already stepped into the very month of December, then others surely, would equally resurrect in due time. These plants are well established refining and fully functional facilities when in full operation, as they had in the past performed very creditably well with beehives of activities (economic, commercial and technical) going on within and around them. It is never too late if the country gets it right this time around because, as an Igbo adage says, “whenever one wakes up, it becomes his morning”. 

It is true that Nigeria has long become “a sleeping giant” economically. Although the very imposing and intimidating large population has wrongly advised external spectators and admirers to christen the country the “giant of Africa”, which is a false notion because the economy has  grossly performed below expectations in most of the period of her existence as a sovereign nation. I firmly differ from such positive tagging of an economy that represents the “poverty capital of the world”, owing to bad leadership and poor governance for many decades.

The economy could still pick up again if those in authority sincerely and genuinely decide they want it to; and if they mean well for poor Nigerians. The crude oil and gas (hydrocarbon) business in Nigeria has largely remained very volatile in its operations. It is equally largely the root cause of the current economic hardship everyone within the economy (both the rich and the poor) is passing through; with the high cost of goods and services. One believes that it is transient because, “no condition is permanent”. A single and clear evidence is the significant impact and the great economic importance of petroleum resources in the nation’s economic landscape. For instance, just the single pronouncement made on 29 May 2023 by President Bola Tinubu of the removal of fuel subsidy instantly changed everything one can think of within the economy. For as long as the petroleum sector contributes the major chunk of Nigeria’s foreign exchange earnings through exports, the hardship currently being experienced by everyone has proven that local refining is the way out of the country’s economic woes. The other economic sectors will need to buckle up and be productive so that the overall narrative of the economy can change in a truly diversified way.

The world’s efforts to checkmate global warming through an energy transition programme to renewable energy sources, under the UN’s climate action on carbon dioxide reduction, adapt and control further environmental catastrophe on earth (climate change), is continuing at the ongoing convention in Dubai, COP28, which opened on 30 November. The place of crude oil and natural gas in the global energy business will be gradually replaced over time (especially in Africa). So, local refining business within Nigeria’s economic space, should be strongly encouraged for investments (including the numerous existing modular refineries and the giant Dangote facility), based on the fact that it will still be  relevant for another 40-50 years, even more. This is especially the case as natural gas is the nation’s hope for the energy business of tomorrow; natural gas being energy compliant as a cleaner energy (although fossil fuel sourced).

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