Bayo Ojulari, Group Chief Executive Officer (GCEO) of the Nigerian National Petroleum Company (NNPC) Limited, says the company was losing about N500 million monthly on the Port Harcourt refinery.
Ojulari spoke on Thursday in Abuja when he received a delegation from the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN), led by Festus Osifo, its president.
He said rehabilitating the refinery has been challenging due to years of neglect.
“When you fix one thing, the other thing is still there. So, it’s been very difficult to get it,” Ojulari said.
“When I resumed, one of the first priorities I focused on was the refineries, to have a quick review, to see whether we could quickly fix it.
“What I found is that we were losing between N300 million to N500 million on a monthly basis in the overall refinery.
“Let’s take Port Harcourt. We were pumping about 950,000 barrels as cargo to go to the refinery. You know that kind of price.”
Ojulari said when the NNPC looked at the inputs and outputs, the mass balance showed that less than 40 percent of what was going in was coming out.
“Then you also found that we were producing mid-grade product because only half of the refinery was working,” he said.
“The way the refinery is designed, the two parts are one. You hear old refinery, new refinery. That’s the wrong information.
“The way the refinery was designed, when the old refinery came forward was that the old refinery was meant to feed into the new for the end product to be of the right standard to the market.”
The NNPC GCEO said attempts to revamp the old refinery were not optimal.
“And that’s why we could not properly produce premium motor spirit (PMS),” Ojulari said.
“But also the mid-grade product we were producing was at a significant loss to all of us. We’re all Nigerians. It’s not about me or anything. That was the problem.
“So the first thing we then said was that rather than continue to lose, let’s quickly stop and look for a way to put the refinery into a sustainably profitable venture, but also a means of sustainable employment.”
Ojulari said President Bola Tinubu did not put pressure “on me to just do the wrong thing”.
“The mandate I was given is to look at the baseline and ensure that whatever we’re doing going forward sustainably works,” he said.
“There’s no need for us to pretend. So there was no negative political pressure for NNPC to just continue to run at a loss.”
He said the company, therefore, decided to halt rehabilitation at the refinery, adding that “we’ve been working assiduously to quickly find a way”.
On July 30, Ojulari said the NNPC had no plans to sell off the Port Harcourt refinery, reaffirming its commitment to completing the high-grade rehabilitation.
The Cable
