The management of AIPCC Energy Limited, operators of the Edo Refinery and Petrochemicals Company Limited (ERPCL), has raised concerns over the lack of crude oil supply necessary to start production at its 1,000 barrels per day stream refinery. Despite directives from President Bola Tinubu for the Nigerian National Petroleum Company Limited (NNPCL) to supply crude oil to modular refineries, including Dangote Refinery, the Edo Refinery has yet to receive the needed crude.
In a statement made in Benin-City, a representative of ERPCL, Segun Okeni, highlighted the significant challenges the refinery faces due to this persistent lack of supply. The refinery, which requires 1,000 barrels of crude oil per day to operate at full capacity, has been unable to function effectively, despite having existing supply agreements with Seplat and ND Western since 2022. However, bureaucratic delays have prevented the refinery from accessing the crude oil.
Okeni noted that ERPCL had reached out to the NNPCL as early as August 2021, with a formal request for crude oil supply following meetings with NNPCL’s CEO, Mele Kyari. Despite this, and a series of subsequent correspondences and site inspections, no crude oil has been allocated to the refinery.
ERPCL’s management has expressed frustration with the situation, particularly given that other options for crude oil allocation, such as from ND Western, First Hydrocarbon, and Seplat, have also not materialized. The company even secured a crude oil supply agreement with ND Western to lift oil from the Ughelli Pumping Station (UPS), yet progress remains stalled.
Okeni emphasized that the lack of crude oil supply not only hampers the refinery’s operations but also sends a discouraging message to potential foreign investors. He argued that the daily demand of all modular refineries in Nigeria amounts to less than two percent of the country’s daily crude oil production. Facilitating supply to these smaller refineries could reduce pipeline losses and improve overall efficiency.
Okeni called for NNPCL and other producers to implement the necessary loading infrastructure to allow for truck loading, criticizing the disparity in how resources are allocated between larger refineries like Dangote’s, which receives 30,000 barrels per day, and smaller players like Edo Refinery.
In his concluding remarks, Okeni warned that the continued neglect of smaller modular refineries could lead to significant losses for Nigeria, as the inability to supply these refineries with crude has already cost the country millions of dollars over the past three years.
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