The Nigerian National Petroleum Corporation has explained how it ruined the Port Harcourt refinery that now requires at least $1.5 billion to resuscitate it, claiming that the country does not have the money to build a new refinery.

Mele Kyari, NNPC’s Group Managing Director, disclosed this on Monday in Abuja while engaging journalists on the proposed rehabilitation of the Port Harcourt refinery approved by the federal government last week.

“What we are seeing today is the cumulative effect of our lack of doing proper maintenance over a period of time, but something has changed today, and this is why we are proud to tell Nigerians that we have done something different in the background,” he stated.  

Mr Kyari claimed building a new refinery would cost the country about $10 billion, far beyond the $1.5 billion earmarked for the Port Harcourt refinery’s rehabilitation.

He added that the country would have to live with importing petroleum products, especially petrol, for another four years if the country ventured into building a new refinery.

“If we start a new refinery of this nature today, it can’t work in less than four years. Therefore, it means we will continue to import petroleum products in the next four years or more.

“We have people saying why not build a new one; why will you repair an old refinery with $1.5 billion? The fact is available even by Google search, what it takes to build a refinery of this status today,” he stated further.

Continuing, he claimed, “It will be difficult for the country to build a new refinery as it will take four years for it to commence production. It is around $7 billion and $12 billion to construct a refinery of this nature (Port Harcourt refinery).

“This is the estimate you see in public space, and there are things you do outside the construction battle-limits like the utilities that are never accounted for when estimates of this nature are done.”

According to him, there is an additional 25 per cent cost for construction battle-limits.

“So, when you say a refinery can be built at $7 billion or even $10 billion, also think of that 25 per cent,” Mr Kyari pointed out. “With today’s estimate, you cannot build a refinery at any cost below these amounts, that means that the option you have is to scrap this and build a new one, and we all know that we don’t have that resource.”

He admitted that the rot in the country’s refineries was the fault of the NNPC.

“This is because we have a government that allowed us to play our role without interference in terms of our procurement exercises, and this made the process go unhindered.

“This has also allowed us to involve every stakeholder, including NUPENG and NEITI, to ensure openness and accountability of the process,” added Mr Kyari.

(NAN)