Nigeria’s state oil firm, the Nigerian National Petroleum Corporation (NNPC), is in the final stages of talks with two consortia that include top traders, energy majors, and oil services companies to revamp its dilapidated refineries.
The move is aimed at helping the country save billions of dollars on fuel importation.
Banking and trading sources said the groups would be paid via the offtake of refined products rather than cash, putting the onus on them to revive the refineries and keep them running smoothly to ensure their investments earn a return.
The first group comprised the world’s largest oil trader, Vitol, with Italy’s Saipem, U.S. firm, General Electric (GE) and Nigerian traders, Sahara Group and MRS Oil Nigeria Plc and would refurbish Warri refinery in southern Delta state and the refinery in northern Kaduna state, the sources said.
A second consortium is made up of global commodities trader Trafigura, Italian oil major Eni, Spanish refiner Cepsa and Nigeria’s Oando. This group would carry out repairs at Port Harcourt, which consists of two refining plants, the sources said.
Ibe Kachikwu, Nigeria’s minister of state for petroleum resources, had said earlier in February that the private investors in its refineries were to be announced in March.
It should be recalled that the Nigerian government, in October, 2017 disclosed that 26 firms had shown interest in the plan to overhaul the nation’s oil refineries in an investment worth over $2 billion.
