DPR/Diezani Madueke: Deceiving Buhari On Renewed Modular Refineries’ Licensing, By Ifeanyi Izeze

Jonathan and Diezani, the 'oil godess', Diezani is sister to Jonathan's concubine/ baby mama and also hails from the Niger Delta

By Ifeanyi Izeze

There are so many things the Muhammadu Buhari-led government would need to do immediately it comes onboard to in the first instance, correct the impression that Nigeria is a country of unserious-minded people.

How do you reconcile that the Department of Petroleum Resources (DPR) few days to a new government taking over the administration of this country has suddenly remember that all we need to solve the lingering crisis in local production of petroleum products is the modular refinery concept?

The DPR knew about proposed modular refineries for almost ten years or even more now but because of the fear of soon-to-come Buhari, the agency has suddenly woken up its ideas and it’s already on a globe-trotting road-show that is showing nothing other than a suspected conspiracy of handing licences to another batch of loyal oil traders. At least five of my colleagues in the Society of Petroleum Engineers (SPE) have been begging the DPR since 2010 for licences to set up modular refineries in the Niger Delta but could not get it for reasons best known to the folks at the DPR and the Office of the Petroleum Minister. So the idea of building modular plants across the country is not a new one and this rush by the DPR is uncalled for and outrightly suspicious.

As stated on the DPR website, “The Honourable Minister of Petroleum Resources, Mrs Diezani Allison Madueke has approved the development of guidelines for the establishment of modular refineries in the country.
“These guidelines would enable the DPR to filter fresh applications from interested investors in the downstream sector of the industry who may wish to operate these lightweight facilities in a bid to shore up our products refining capability.”

Good as said by the DPR that a modular refinery, valued at between $1m and $15m depending on the capacity, will squeeze out value from stranded hydrocarbon in remote locations and marginal fields to enhance resource utilisation and spur economic activities, why the rush to release this elaborate roadmap three days to a new administration taking over?

Why do you think it is hard for the authorities to harness the dividends of our oil sector? It is simply because Government officials in Nigeria are too obsessed with “control” and “regulation” in order to open up avenues for corruption. It is easier to make money running political outfits and other non-productive activities. Most of the trumpeted frauds in the NNPC are linked to the officials of the DPR who rather than patriotically monitor and regulate the activities of the oil sector including the NNPC, prefer to collaborate in the blurred transactions across the sector.

The Deputy Director, Engineering and Standards, DPR, Mr. Alfred Ohiani, who represented the Director, George Osahon at the Lagos roadshow was quoted as saying “To facilitate the process of setting up modular refineries, the DPR will pre-qualify a number of original equipment manufacturers thereby eliminating/minimising the process of verification of engineering.

DPR should keep their proposal until sanity being planned by Buhari is meted on them and other agencies and parastatals in the Petroleum Ministry. Is it now that the idea of modular refineries which was deliberately kept away all these years of deliberate killing of our existing refineries and its associated fuel import racket plus unprecedented crude oil theft, is being pursued as if there is notomorrow?
In 2002 under the Obasanjo administration, 18 licenses for the construction of private refineries were issued by this same DPR. What happened to the licenses and the refineries?

It would be recalled that the NNPC Greenfield Refinery Projects Division (GRPD) came into existence late 2005 as a strategic response to a lack of visible progress on the 18 Licenses issued by the DPR for Private Refineries in 2002 and also, the negative consequences of massive importation of petroleum products against the backdrop of low capacity utilization in the existing three (3) refineries (445KBD capacity).

On July 3 2010, the Minister of Trade and Investment, Mr. Olusegun Aganga, announced that the federal government had signed another MoU with two firms, United State-based Vulcan Petroleum Resources and Petroleum Refining and Strategic Reserve Ltd, a Nigerian company, for the construction of six modular refineries in the country at an estimated cost of $4.5 billion.

Aganga, who signed on behalf of the federal government, stated that the refineries, with a combined capacity to refine 180,000 barrels of oil per day, would be located in areas where there are crude oil pipelines. He said, when completed, each of the modular plants will refine up to 30,000 barrels of crude oil per day and produce up to five million litres of petrol, diesel and kerosene.

The minister emphatically stated that two of the refineries would be completed within 12 months, and even gave the assurance that the Ministry of Trade would work together with the Ministry of Petroleum Resources and the NNPC to ensure the actualisation of the projects.

“We are working in collaboration with the Ministry of Petroleum Resources and NNPC. We are working together as a team to ensure that in 12 months’ time, we will witness the inauguration of the refineries.
Vice-President/Director, Vulcan Petroleum Resources, Mr. Jim Mansfield, and Chairman, Petroleum Refining and Strategic Reserve, Mr. Edozie Njoku, reportedly signed on behalf of their respective companies. Njoku had also corroborated the minister’s statement that partners in the deal would work with the Ministry of Petroleum Resources and NNPC to actualise the project.

Can the DPR first tell us why for almost five years after the signing of Memorandum of Understanding with companies/investors with licenses Nigeria is yet to see the result of the proposed six modular refineries slated to have been constructed within 30 months at a cost of $4.5 billion? Where are the refineries licensed because there is nothing on ground to indicate that the project has actually commenced almost five years after the MoU was sealed? So what is the gang at the DPR doing differently now that was not done when the first set of licenses were issued?

The truth most Nigerians don’t know is that most of these licensees rather than use the permit to build modular refineries had in collaboration with DPR top officials criminally veered into using the same licenses for crude oil lifting under all sorts of guises. Is that how a country can make progress?

Let the new government come in place first with its own ideas of how to run our oil sector before dishing out licences to another set of traders and area boys whether for modular or conventional refineries. We all agree there has to be a change in the way we run things in this country. So let’s wait and see if change has actually come with the new government or whether we still need to wait for another. God bless Nigeria!
(IFEANYI IZEZE, Manager, Atiku Media Office Abuja: [email protected]; 234-8033043009)