The House of Representatives has directed its Committee on Petroleum Resources (Downstream), to carry out an investigative hearing, as well as conduct a comprehensive audit of funds previously spent on the rehabilitation, and or repair of the Port Harcourt refinery.
While also mandating the committee to determine the performance indicators following the maintenance, the committee has further been directed to examine the performance bond, assurance, warranties and guarantees put in place for operation and maintenance of the plants after commissioning and report its findings back to the House within six weeks.
This was as the House urged the federal government to grant license and provide incentives for the building and construction of modular refineries.
The resolution was sequel to a motion, moved under matters of urgent public importance on Wednesday, by Hon. Onofiok Luke, expressing concern on the recent approval of $1.5 billion, (about N575 billion), for immediate commencement of rehabilitation work on the 32-year-old Port Harcourt refinery.
The project was said to have been phased at an estimated completion period of 44 Months (approximately 4 Years) with three components funding from Nigerian National Petroleum Corporation (NNPC), Internally Generated Revenue (IGR), budgetary allocations, and Afreximbank facility.
The lawmaker recalled that the Port Harcourt refinery located in Alesa Eleme south-east of Port Harcourt, operates two oil refineries, including an old plant commissioned in 1965 that can process 60,000 barrels (9,500 m3) per stream day, as well as the new plant commissioned in 1989, which has a capacity of 150,000 barrels (24,000 m3) per stream day.
However, he said NNPC had allegedly spent about $25 billion in turnaround maintenance of refineries in the past 25 years, while “this latest prevailing development Is coming after promises by the current administration that the government would no longer spend on the facility.” adding that previous rehabilitations notwithstanding, NNPC audit report had last year revealed that three of the nation’s four refineries recorded N1.64 trillion cumulative losses in their 2014 to 2018 details.
“Despite processing no crude oil in June last year, the three refineries still cost the country N10.23 billion in expenses. The three refineries processed no crude because of the rehabilitation works being carried out on them, therefore, there was no associated crude plus freight cost for the three refineries since there was no production but operational expenses that amounted to 10.27 billion. This resulted in an operating deficit of 810.23 billion by the refineries,” he said,
