By Prince Okafor
With the increasing number of illegal refineries in the Niger Delta region, the Minister of State for Petroleum Resources, Timipre Sylva, has revealed why the situation has persisted this long, despite series of arrests by the Nigeria Joint Task Force.
Energy Vanguard gathered that the Nigerian Navy had deactivated 577 illegal refineries since 2020 across the Niger Delta region.
Also, a recent report by the Nigeria Extractive Industries Transparency Initiatives (NEITI) shows that about half a million people in the Niger Delta are employed in the illegal refining industry.
The report also stated that the Gross Domestic Product, GDP, of the industry is about three times Nigeria’s average.
However, Sylva during the shareholder’s agreement on the construction of Brass Petroleum Products Terminal Limited (BPPT), stated that, residents of riverine areas had perpetually bought refined petroleum products at astronomical prices because of the huge cost of transporting products to those locations.
“The prevalence of illegal refineries in the region is attributed to the non-availability of legitimate alternatives, the Brass Petroleum Products Terminal Limited (BPPT) will solve some of the problems of the Niger Delta region.”
The BPPT located at Okpoama, Brass Local Government Area, Bayelsa State, will be developed by the Nigerian Content Development and Monitoring Board (NCDMB), Nigerian National Petroleum Corporation, and ZED Energy Limited.
The estimated cost of the project is N10.5bn (Ten Billion, Five Hundred Million Naira).
NCDMB and NNPC own 30 percent respectively while ZED Energy – a private firm holds 40 percent and would operate the terminal upon completion.
The terminal would make refined petroleum products available to riverine communities of the Niger Delta at the standard prices, discourage the operations of illegal refineries and create job opportunities for citizens of the Niger Delta and other Nigerians.
Group General Manager, National Petroleum Investment Management Services (NAPIMS) and Project Lead of the BPPT, Mr. Bala Wunti noted that since the commencement of oil exploration at Oloibiri in Bayelsa in 1958, there has not been any significant downstream activity or investment in the state.
He further stated that Bayelsa State produces 40 percent of Nigeria’s onshore and swamp crude oil and hosts some of the nation’s Deepwater prospects and assets, yet there was no correlation with the level of socio-economic development and employment.
“Our intention is that this adventure would try to close that gap,” he promised.
He also confirmed that the cost of the project had been estimated at N10.5bn and it was arrived at the pre-engineering and pre-front-end engineering design (Pre-FEED).
He stated that the funds would come from the partners and there are no risks regarding finance.
He added: “We have done our baseline survey and we want to start procurements of long-lead items and several other things, including engineering.
“The idea is that long before 2023, we would have this depot up and running. It would bring a unique and innovative depot platform.
“This will be a dual loading facility; it would load land trucks and marine trucks. It means we are creating something that is better than floating storage. It will also reduce demurrage”.