[ad_1]
The Nigerian Nationwide Petroleum Firm Restricted (NNPC) has awarded new contracts to 4 firms, together with two downstream corporations, for the rehabilitation of the nation’s pipelines, sparking criticisms from business operators.
BusinessDay findings confirmed Oilserv Restricted, A.A RANO Nigeria Restricted, Macready Oil & Fuel Service Firm Restricted, and MRS Oil Nigeria Plc emerged as most well-liked bidders for the upkeep of the pipelines, by the construct, function, and switch financing mannequin to facilitate crude provide to the refineries and merchandise evacuation from them.
The pipeline community consists of 4,315km of multi-product pipelines and 701km of crude oil pipelines, interconnecting 22 gasoline depots, the nation’s 4 refineries, and the jetties at Atlas Cove and Warri.
Trade specialists who spoke to BusinessDay stated the developments will give retailers that received pipeline contracts a aggressive benefit over others with entry to a dependable and safe provide – a improvement they described as opposite to international requirements.
“It’s an anomaly for downstream retailers to win pipeline contracts. Within the US market, pipeline operators are separated from retailers,” a enterprise chief in Nigeria’s vitality sector stated. “Whether or not accidentally or deliberate regulatory constraint, no single firm sits astride all the worth chain.”
BusinessDay’s findings confirmed among the greatest United States pipeline firms corresponding to Kinder Morgan, Williams Firm, and Colonial Pipeline are midstream operators with no stores.
“Retail firms with no antecedents of dealing with pipeline contracts shouldn’t be successful contracts for million-dollar pipeline initiatives in Nigeria. It provides room for exploitation,” the supply stated.
One other senior oil government who spoke to BusinessDay stated the brand new pipeline offers confirmed the transition from state monopoly beneath the NNPC to non-public monopoly as some elements of the nation could also be underserved.
Learn additionally: Power ministers, NNPC boss, others to talk at NAEC convention
“The market has a priority that within the occasion of any provide shortfall, these retail operators with pipeline contracts might have preferences for their very own retail outlet which isn’t good for the market,” one other business supply informed BusinessDay.
BusinessDay’s findings revealed the nation’s oil behemoth chosen the 4 firms as most well-liked bidders on a LOT foundation for the rehabilitation of the nation’s idle pipelines.
It was learnt that Oilserv Restricted emerged as the popular bidder for LOT 1, which contains the Bonny-Port Harcourt Crude Oil pipeline (54.8km), Port Harcourt-Aba–Enugu Merchandise Pipeline (210km), Port Harcourt depot, Aba Depot and Enugu Depot. Port Harcourt Refinery–Bonny Export Terminal Merchandise Pipeline (35km) Bonny Export Terminal–Loading Jetty Merchandise Pipeline (32km), Bonny Export Terminal services.
A.A Rano received the bid for LOT 2, which contains Escravos–Warri Crude Oil Pipeline (60km), Warri-Benin Merchandise Pipeline (90km), Benin-Ore Merchandise Pipeline (110km), Warri Depot, Benin Depot and Ore Depot.
Macready Oil & Fuel Service Firm Restricted was chosen for LOT 3, which contains Warri-Kaduna Crude Oil Pipeline (604km), Kaduna-Kano Merchandise Pipeline (224.3km), Kaduna-Jos Merchandise Pipeline (166.4km), Kaduna-Suleja Merchandise Pipeline (170.8km), Kaduna Depot, Kano Depot, Jos Depot and Suleja Depot.
MRS Oil Nigeria Plc received LOT 4, which contains Atlas Cove–Mosimi/Satellite tv for pc Merchandise Pipeline (72.8km), Mosimi–Ore Merchandise Pipeline (151.3km), Mosimi–Ibadan Merchandise Pipeline (79.1km), Ibadan-Ilorin Merchandise Pipeline (168.9km), Atlas Cove Depot, Mosimi Depot, Satellite tv for pc Depot, Ibadan Depot, and llorin Depot.
“LOT 4 is a reasonably well-developed market with NNPC already incurring the capital value for infrastructure earlier than transferring to the popular winner. From a aggressive viewpoint, it provides the winner a bonus in comparison with others,” Kelvin Atafiri, the CEO of Cavazanni Human Capital Restricted, stated.
In 2021, MRS and AA Rano have been among the many firms chosen for Nigeria’s crude-for-fuel swap contracts for one 12 months.
The contracts, often known as direct sale, direct buy, are coveted since they’re used to provide almost all of Nigeria’s petrol wants in addition to cowl a few of its diesel and jet gasoline consumption.
Learn additionally: Inside Afreximbank-NNPC $3 billion phantom mortgage
Efforts to get responses from AA Rano and MRS as at time of publication proved abortive.
“I might have anticipated core engineering and procurement development firms can be chosen, not retailers,” he added.
NNPC’s pipeline community was designed to effectively transfer crude oil from terminals positioned at Escravos and Bonny to Warri Refining and Petrochemical Firm and Port Harcourt Refining Firm, respectively.
Nevertheless, poor upkeep and vandalism have left many government-owned gasoline depots and pipelines idle for years, a improvement that has induced the nation to more and more resort to non-public tank farms and highway tankers for the provision and distribution of merchandise.
“There’s a massive concern about the place NNPC will get the crude oil to provide the refineries that may get the gasoline tankers off the highway,” Niyi Awodeyi, CEO of Subterra Power Sources Restricted, stated.
The administration of President Bola Tinubu has stated that by subsequent 12 months, the nation will likely be a web exporter of petroleum merchandise with the rehabilitation of refineries within the nation, beginning with the Port Harcourt refinery. Nevertheless, antecedents have led to a belief deficit between the general public and the federal government.
In September 2022, Timipre Sylva, the then minister of state for petroleum assets, stated the Port Harcourt refinery would turn out to be purposeful by the top of final 12 months. Six months later, he stated the plant would begin refining actions earlier than the top of the second quarter of 2023. That is the third quarter of the 12 months and the projection moved by one other quarter.
“To be candid, within the quick time period, the drive to ramp up manufacturing instantly is safety to make sure zero loss to theft and vandalism. And I ponder if the federal government can obtain that,” stated Jide Pratt, nation supervisor of Commerce Grid.
[ad_2]
Source link
