Ibe Kachikwu, minister of State for Petroleum Resources, has disclosed that the country spent N3.4 trillion on importation of petroleum products and N1.34 trillion on logistics, bringing the total to N4.74 trillion in 2016.
Kachikwu said, “The importation of petroleum products between January and December of last year amounted to about 20 million metric tonnes. A total amount of N3.4tn was spent. The consumption of foreign exchange from the Central Bank of Nigeria was approximately 30 per cent of the CBN’s total foreign exchange outlay, and the logistic cost of that importation was about N1.34tn within the same one year period.”
He was rmphatic that the country must end the importation of refined petroleum products: “The domestic refining capacity as of today is six million litres out of a total consumption of about 35 million litres, averaging less than 25 per cent. In the midst of this sort of statistics, it is absolutely critical that we move in to try to end importation of products, improve our refineries and get them up to 100 per cent nameplate.”
He also said the government had neither given out any of the refineries to private investors as concessions nor had disposed them. He explained that no financier has been selected to revamp the refineries as the government is still searching. He said the federal government would require about $1.2 billion to repair and bring the four refineries in Port Harcourt, Warri and Kaduna up to 100 per cent production level.
“Internally, we have been able to determine the sort of amount that will be required to do this work in terms of what work is really required to be done. The total cumulative amount is in the $1.1 billion and $1.2 billion category between all the refineries. And that, of course, does not include the pipelines. You have got to address the pipelines and that is something else that is being done.”
The minister said a presidential approval has been granted the Nigerian National Petroleum Corporation, NNPC, to engage credible financiers to rehabilitate and improve the performance of the refineries. Hence Agip, Saudis and Qataris were initially identified for engagement. He added that the government also indicated that it would invite the original builders of the  refineries to undertake the repairs.
Kachikwu stated that after a public tender in April last year, bids were received and analysed, and winners emerged for the Port Harcourt and Warri refineries. But he said discussions were had not been finalised before the final approval by both the board of NNPC and the Federal Executive Council, FEC.