By Michael Eboh
The dismal performance of the country’s three refineries, Warri, Port Harcourt and Kaduna refineries, continued, as the refineries posted operating deficit of N8.36 billion in January 2019, according to data released by the Nigerian National Petroleum Corporation, NNPC.
The NNPC, in its Monthly Financial and Operations Report for January 2019, disclosed that deficit recorded in the month under review represented an improvement compared with the operating deficit of N17.32 billion recorded in December 2018.
Giving a breakdown of the consolidated financial statements of the three refineries, the NNPC report disclosed that the refineries recorded combined revenue of N33.7 billion in January 2019, rising by 209.17 per cent from N10.9 billion recorded in December 2018.
It added that the three refineries recorded crude plus freight cost of N31.58 billion, compared to N8.9 billion in the previous month; while operating expenses dipped to N10.47 billion fromN19.29 billion recorded in December 2018.
Individually, the report noted that Warri Refinery and Petrochemical Company, WRPC, recorded revenue of N32.64 billion in January 2019, compared to N9.59 billion in December; crude plus freight cost stood at N31.5 billion, as against N8.99 billion in December; operating expenses grew slightly from N3.217 billion in December to N3.57 billion; while it recorded operating deficit of N2.51 billion, dropping slightly from N2.52 billion recorded in December.
The report added that Kaduna Refinery and Petrochemical Company recorded revenue, operating expenses and operating deficit of N522.93 million, N4.26 billion and N3.74 billion respectively in January, compared to N1.25 billion, N3.07 billion and N1.83 billion respectively in December.
Port Harcourt Refining Company, PHRC, the report declared posted N527.50 million, N2.64 billion and N2.11 billion as revenue, operating expenses and operating deficit respectively in the month under review, compared to N26.99 billion, N12.99 billion and N12.97 billion respectively.
The report said, “The Corporation has been adopting a Merchant Plant Refineries Business Model since January 2017. The model takes cognizance of the products worth and crude costs. The combined value of output by the three refineries (at import parity price) for the month of January 2019 amounted to N33.69 billion while the associated crude plus freight costs and operational expenses were N31.58 billion and N10.47 billion respectively. This resulted to an operational deficit of N8.36 billion by the refineries.”
The NNPC had announced trade surplus of N15.04 billion for January 2019, an increase of 24 per cent over the N12.13 billion surplus posted by the corporation in December 2019.
The NNPC attributed the positive financial position to the improved performance of NNPC’s upstream subsidiary, Nigerian Petroleum Development Company, NPDC, which recorded surplus numbers despite reduced operational activities in the month.
The NNPC report disclosed that NPDC’s sustained revenue drive, evident from recent average weekly production of 332,000 barrels of crude oil per day, BPD, had made achieving 500,000bpd production by 2020 plausible.
The NPDC’s position, the NNPC noted, contrasted with the high expenditure levels posted by its two other entities, the Petroleum Products Marketing Company, PPMC and Duke Oil, although both ended the month with profit.
In terms of sales and remittance of crude oil and gas proceeds, the NNPC announced total export receipts of $381.70 million in the month under review as against $345.68 million posted in December 2018.
Giving a breakdown of the numbers, the NNPC indicated that contributions from crude oil amounted to $269.43 million, while gas and miscellaneous receipts stood at $111.75 million and $0.52 million respectively.