The Nigerian National Petroleum Company Limited on Wednesday explained that one of the key reasons modular refineries in Nigeria were not producing Premium Motor Spirit, popularly called petrol, was because of the regulated pump price of PMS by government.
A modular refinery is a simplified refinery requiring significantly less capital investment than traditional full-scale refineries. They are crude oil processing facilities with capacities of up to 30,000 barrels per day.
Nigeria has a number of modular refineries in Edo, Delta, Imo and other states, while plans are on to increase the number through private sector investments.
Speaking on the reasons why modular refineries were not producing petrol, during a plenary session at the ongoing Nigeria International Energy Summit 2022 in Abuja, the Group Executive Director, Refining, NNPC, Mustapha Yakubu, said it was due to fuel pump price regulation.
He said, “Some modular refineries should take up to 50,000 barrels per day, but because of financing you can start with 10,000 barrels and then scale up gradually to 50,000 barrels.
“What do you need to do to produce PMS? It is to put additional investment that will put in the cracker required to produce the PMS. But in this period why they (modular refineries) cannot produce PMS is because we are under full regulation.
“So to me, if they produce PMS today, at what cost are they going to produce it and at what cost are they going to sell under this regulated environment?”
(Native Reporters)
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