A group of investors from South Korea has finalized plans to construct four refineries, each with a capacity of 100,000 barrels, in various locations across Nigeria, as announced by the Federal Government on Tuesday. 

Heineken Lokpobiri, the Minister of State for Petroleum Resources, made this announcement during the inaugural summit organized by the Crude Oil Refineries Owners Association of Nigeria in Lagos. He emphasized that the Federal Government is fostering an inviting environment for investors to establish refineries.

Lokpobiri mentioned that the consortium, whose name was not disclosed, has recently received approval to proceed with their plans. “We are promoting the establishment of limited refineries by creating an open environment. A recent approval has been granted to a South Korean consortium aiming to set up four 100,000-barrel refineries in different regions of Nigeria,” he stated.

He further explained that the government is adopting a public-private partnership approach to stimulate investment in the midstream and downstream sectors of the oil and gas industry, which will facilitate the development of both modular and large-scale refineries. 

The oil minister expressed confidence that these initiatives will be fruitful, as the Federal Government is receptive to equity investments in modular and other new refineries to enhance energy security. 

He also noted that the Nigerian Upstream Petroleum Regulatory Commission has established and published guidelines for domestic crude supply obligations to promote transparency in the oil sector and ensure local refineries have access to feedstock. 

Additionally, he highlighted the government's commitment to collaborating with stakeholders to effectively implement the recommendations from the Modular Refinery Committee, which aims to provide special concessions to local refinery owners, thereby securing feedstock for their operations. 

Lokpobiri concluded by assuring that the deregulation of the downstream sector will be fully realized, along with the establishment of a framework to mitigate the impact on the economically disadvantaged.

The ministry has streamlined access to current tax and other exemptions related to the importation of refinery equipment, aligning with our strategy to achieve self-sufficiency for petroleum producers in Nigeria and establish the country as Africa’s leading petroleum refining center. 

Lokpobiri noted that while the Petroleum Industry Act (PIA) established the petroleum ministry and the National Gas Infrastructure Fund, which is financed through domestic petroleum product sales, the ministry envisions allocating a portion of these funds to enhance infrastructure development for refineries, similar to initiatives in the gas value chain. 

“To facilitate this, we will begin a review of the PIA. In the meantime, CORAN should spearhead the advocacy efforts. We are focusing on building partnerships with international organizations through the Petroleum Technology Development Fund and the Nigerian Content Development and Monitoring Board to enhance knowledge transfer for workforce development in refinery operations, as well as to invest in research and development that fosters technological progress and innovation in the refining industry. 

Shortly, we plan to establish an apprenticeship program in collaboration with existing refineries to cultivate expertise in our refining operations,” he stated. 

To combat crude oil theft and illegal refining, he mentioned that the ministry has formed an international emergency committee dedicated to developing home-grown solutions for domestic refining.