FG makes u-turn on modular refineries

The Federal Government, in apparent contradiction of its earlier position made a u-turn on its modular refineries initiative, declaring that it would no longer allow the proliferation of such refineries across the Niger Delta region.

It will be recalled that the Federal Government had said that it will encourage the setting up of modular crude oil refineries in oil-producing communities across the Niger Delta, while it also planned to legalise illegal crude oil refiners and incorporate them into the modular refineries initiative.
Minister of State for Petroleum Resources, Mr. Ibe Kachikwu, speaking in Abuja said that having small modular refineries scattered across the length and breadth of the Niger Delta will increase environmental degradation, worsen gas flare and the problems of the region.

Kachikwu was speaking at the presentation of the report of the New Nigerian Oil and Gas Sector Governance Policy Consultation Workshop held in Aberdeen, Scotland, by Nigerians in Diaspora Organisation, Europe, United Kingdom and North Aberdeen. Kachikwu said that the government is considering a situation where modular refineries would be located only in areas where its products would be easily evacuated and getting feedstock to them would not be cumbersome.
He said the Federal Government is commissioning a broad study that would lead to the development of an intelligent plan for the construction of modular refineries in the region.

He said, “It is important to clear a misconception, especially as it has to do with modular refineries. Setting up smaller modular refineries in so many places in the Niger Delta would worsen gas flares in the region and also bring about environmental challenges.
“It is critical to develop an integrated approach and plan to modular refineries construction in the Niger Delta, ensure that they are properly optimised and are not scattered everywhere. If the refineries are scattered everywhere they would not provide significant economic benefits to the country.”

In addition, Kachikwu said that the Federal Government would commence the gas flare commercialisation initiative by June this year, and would conduct marginal fields licensing round next year.
He said the gas flare commercialisation initiative would provide an opportunity to people interested in participating in gas flare capture using technology, while the marginal fields bid round would provide access to stranded reserves, especially to competent companies that would make significant contributions in growing Nigeria’s reserves.