Minister of State for Petroleum Resources, Ibe Kachikwu, yesterday in Riyadh, Saudi Arabia, said about N900 billion ($2.5 billion) is required to rehabilitate Nigeria’s refineries.
Minister of Energy Industry and Mineral Resources of the Kingdom of Saudi Arabia, Khalid Al Falih, had hinted on the possibility of his country establishing an independent refinery in Nigeria, which his country considers as the best hub to reach other African countries.
Kachikwu, however, said lots of options were on the table and that the country needs to urgently make the decision of going with one.
The minister said: “I can’t make a final decision alone in terms of what options to be chosen. In terms of what options are on the table for the refineries, NNPC negotiated with the investors for like one and half years after the president approved. Unfortunately, they couldn’t reach a conclusion for whatever reason. We are obviously going to revisit the discussion. I think that’s the fastest way to go.
“The second option is that we decided that we are going to dip our hands into our own Internal funds- which we don’t have a lot of – and make the money available. What is required is about $2.5billion to rekit the entire refinery and the reason why I don’t want to go that way is the fact that the country is constrained.”
Kachikwu said Nigeria’s third option was to target countries that could help out in terms of refining.
He asserted that getting the four refineries up and running back to 90/95 per cent capacity without further delay was necessary.
According to him, Nigeria remains a key investment destination because of existing resources, location and technical know-how that would bolster investment decision.
“We are targeting those countries who want to put in investment either on a 100 per cent basis or collaboration with oil companies that have worked with them,” Kachikwu stated.
He said the visit to Saudi Arabia became necessary due to both countries having a common ground, and also because of the success of the country in the oil sector.
Kachikwu disclosed that the visit yielded positive results which may lead to massive investment from Saudi Arabia, including an independent refinery.
“We want to leverage on the huge success of Saudi government in terms of petroleum. Last year alone, Saudi Aramco, an equivalent of NNPC, made about $200 billion as profits.
“We have a lot of common ground, historical ties, religious ties and there’s a need to move further. We cooperate a lot with one another in OPEC, especially in the Ministry of Energy,” Kachikwu stated.
According to him, Nigeria is already setting up a team to make the reasons for the visit a reality.
Apart from series of engagements with key government personalities in Saudi Arabia, Kachikwu and his team met with top executives of Saudi Aramco, King Abdullah Petroleum Studies and Research Centre (KAPSARC), Saudi Basic Industries Corporation (SABIC) and Royal Commission for Jubail and Yanbu (RCJY) to explore possible solutions and business opportunities that would enable Nigeria grow its petroleum sector.