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Kachikwu explains why Nigeria’s refineries were unable to work at full capacity

Government’s focus on solving fuel scarcity and reforming the petroleum industry to get the refinery working at full capacity was a key target to make the refineries working at full capacity, said the former Minister of State for Petroleum Resources, Dr. Emmanuel Ibe Kachikwu.

In an interview, Kachikwu admitted that the refineries were performing poorly noting that there were complex issues including those of liquidity to get the refineries working at such capacity.

He said, “You’re right, it is performing poorly. It is one area where I think we did not deliver the mandate. I am bold enough to say that.”

Kachikwu said claims by people that the government was not getting the refineries fixed was a stark misunderstanding of how the system works.

“We looked at refineries (when I came in), the first problem we had with the refineries was that they were not even performing at all. And because of the apparent huge fuel scarcity, it was a major challenge for me.

“So, I focused on trying to get them kitted up, let’s begin no matter how little. So my target was to try and get them to do at least five million litres in a short time frame,” he explained.

Further speaking on the efforts to revamp the refineries, he said, “By sometime in March of 2016, the refineries began to produce not obviously in their 90 per cent capacity but at least they were adding two to three million litres.”

Although he said getting the refineries to add to local production was a success, he added that getting the entire Turn Around Maintenance (TAM) was a failed exercise.

He said: “However, it was key that the years of turn around maintenance have been a failed exercise, billions and billions had been spent and every time again, the thing just packs up and in any case, for years, no serious turn around maintenance had been done.”

Kachikwu said President Muhammadu Buhari approved his recommendation on finding willing private sector investors in the refineries not to be as shareholders but on an incremental volume uptake.

He said, “The president approved that but at that time I left as Group Managing Director (GMD) of the Nigerian National Petroleum Corporation (NNPC) and then handed it over to NNPC.

NNPC owns the refinery so a minister’s role is not to come in and head negotiation of how the refineries will work. Mine is to push those policies and get those approvals and make sure that it is still on track,” Kachikwu confirmed.

Source: Daily Trust