Why Nigeria is promoting modular refineries, by Osinbajo

FG considers licensing, oil allocation to check scarcity
Vice President Yemi Osinbajo has said the integration of artisanal and modular refinery operators into mainstream oil and gas sector promotes the inclusion of more local content in the industry and advances deployment of homegrown technology in the refining of petroleum products.

He made the submission in an address delivered virtually at a “National Summit on the Integration of Artisanal and Modular Refinery Operations in Nigeria” convened by the Senior Special Assistant to the President on Niger Delta Affairs, Senator Ita Enang.

According to him, “we are confident that the integration of artisanal and modular refinery operations into the oil and gas sector will not only promote the inclusion of more local content in the industry; it will advance the use of home-grown technology in the refining of petroleum products and also curtail illegal oil activities in the Niger Delta region.”

On President Muhammadu Buhari’s order, the Vice President Osinbajo had, in 2016, embarked on a tour of oil-producing communities, in a bid to address lingering issues in the area.

This was preceded by the President’s meeting with the leaders under the aegis of Pan-Niger Delta Forum (PANDEF) that resulted in the PANDEF’s 16-point demand to the Federal Government and was subsequently captured in the Federal Government’s 20-point agenda to develop the region.

Explaining government’s position on the adoption of a viable model, Osinbajo said: “The transition from artisanal to modular refineries has been delayed because of the operators’ expectation that this process will be fully underwritten by government.

“However, what this framework envisages is a private sector-led partnership with equity participation from the state government or its agencies, registered local cooperative societies and the integration of regional refinery stakeholders, with the private investor having majority equity.”

ALSO, the Minister of State for Finance, Budget and National Planning, Clement Agba, yesterday, said government was considering licensing local refineries to operate and officially allocate crude oil for legitimate refining.

Speaking at same event, he pointed out that the current administration was making the move to address fuel scarcity and product imports.

He said it was the intention of government to make the refineries scalable and sited within clusters for effective operations and minimal environmental footprint.