Connect with us

Legislature

Reps to audit refinery $25Million allegedly spent on refinery maintenance

Published

on

Estimated Reading Time: 2

The House of Representatives, on Wednesday, says it will conduct a comprehensive audit of the estimated sum of $25 billion allegedly spent on Turn Around Maintenance (TAM) of the four refineries over the past 25 years by successive administrations.

The resolution was passed sequel to the adoption of a motion of ‘Matter of urgent public importance’, in pursuant to Order 8, Rule 4 titled: Motion on the need to ensure transparency and accountability in the rehabilitation exercise of the nation’s refineries,’ sponsored by Hon Onofiok Luke.

The House decision is coming on the heel of the Federal Executive Council (FEC) approval of the sum of $1.5 billion, about N575 billion, for immediate commencement of rehabilitation work on the 32-year-old Port Harcourt refinery, 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 provisions, and Afreximbank.

Hon Luke observed that the Port Harcourt Refineries located in Alesa Eleme Southeast 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.

“The House is concerned that NNPC had allegedly spent about $25 billion in turnaround maintenance of refineries in the past 25 years, this latest prevailing development is coming after promises by the current administration that government would no longer spend on the facility. Previous rehabilitations notwithstanding, the Nigerian National Petroleum Corporation (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 N10.27 billion. This resulted in an operating deficit of N10.23 billion by the refineries.”

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *