Energy

NNPCL, Daewoo sign contract for Kaduna refinery repair

The Nigerian National Petroleum Company Limited (NNPCL) and Daewoo Engineering Construction Nigeria Limited have signed a maintenance service contract for the quick-fix repair of the Kaduna Refining and Petrochemical Company Limited (KRPC).

The Group Chief Executive Officer, NNPCL, Mele Kyari, and CEO of Daewoo E&C Nigeria, Jung Taewon, signed the contract on behalf of their respective organisations on Thursday.

The proposed quick-fix initiative on KRPC is expected to restore it to a minimum of 60 per cent of its nameplate capacity by fourth quarter of 2024.

Kyari said restoring local refining capacity would guarantee energy sufficiency, being one of the key things Nigeria required for economic growth.

“There is no way a developing country will talk about energy transition without talking about petroleum products. We understand engagements and conversation around energy transition but we need the liquids of today.

“The only way we can guarantee that is to have local refining capacity restored. We are conscious of the fact that our four refineries in three locations are down now, undergoing rehabilitation process.

“Port Harcourt is on course, Warri is also on schedule and we are committing this Kaduna refinery. Ultimately our 18 million litres per day gasoline production capacity will be restored.

“This will also complement the production start off of Dangote refinery which we have 30 per cent equity, we are hopeful that Nigeria will be self-sufficient in the supply of petroleum products, particularly gasoline in 2023,” the NNPCL boss said.

While expressing hope for the project to be delivered on schedule, Kyari assured the company of safety and security, adding that there would be no risk to its personnel in the course of carrying out their duties.

Also speaking, the Executive Vice President, Downstream, NNPCL, Yemi Adetunji, said the development marked a milestone in the history of KRPC considering that the last Turn Around Maintenance (TAM) on the refinery occurred about 15 years ago.

Adetunji said the project was framed after extensive engagement with Daewoo on the Quick-Fix strategy to repair and re-stream KRPC and operate it on a sustainable basis at a minimum capacity utilisation of 60 per cent.

“This project shall be executed in three work packages as a Maintenance Services contract by Daewoo E&C Nigeria Limited at an estimated maximum cost ceiling of with a duration of 21 months.

“The Quick-Fix strategy guarantees the fastest route to restreaming WRPC and KRPC for in-country production of refined petroleum products. Restoring WRPC and KRPC back to operation will guarantee energy security for the country.

“It will reduce dependence on imported petroleum products in view of near total dependence on supply of imported petroleum products and the impact the ongoing Russia-Ukraine war is having on global supply,” he stated.

Adetunji said that it would generate revenue, reduce demand for Forex, supply raw materials to industries, create employment for Nigerians, and ensure technology transfer, amongst other benefits.

He said the NNPCL was using a combination of internally generated revenue and third party financing to execute the repairs of the Refineries.

“Post rehabilitation of the three Refineries, globally reputable Operations and Maintenance (O&M) contractors shall be engaged to run the refinery Safely, Reliably, Sustainably and Profitably.

“I wish to implore total commitment from all staff in ensuring that this project is successfully executed as over 200 million Nigerians are looking up to NNPC Limited to deliver on this mandate.

“The Board and Management of NNPC limited are fully committed to providing all the required support to ensure that the refineries are repaired and back in operation on cost and schedule,” he added.

The Star