Wednesday, April 6, 2011

$2.5 bln Nigerian refinery sees government approval soon

KLEINMOND, South Africa (Reuters) - Nigeria should approve a new $2.5 billion private refinery after upcoming elections in the west African nation, an official of the proposed Imo refinery said on Wednesday.
The polls in Africa's top oil exporter and most populous nation have been pushed back by a week, with the presidential vote now due on April 16 after administrative chaos caused its first round of voting to be aborted.

"Hopefully after the elections that are going on in Nigeria we will get the government to sign, so that's basically where we are," Anthony Chukwueke, chairman of the implementation committee for the Imo Refinery Project, told Reuters on the sidelines of the NG oil and gas summit.

Chukwueke said Nigeria's national oil company had already signed an agreement in principle supporting the 100,000 barrels per day refinery in the south-eastern part of the country.

"We now need for the government to bless the agreements because it contains some incentives we want to put in for investors, and when we have obtained this, we will be in a position to invite investors to participate," he said.

Chukwueke said the plan was to ramp up production at Imo to 200,000 or 250,000 bpd, with first refined oil likely by 2016. Land for the refinery had already been identified, he added.

Nigeria, which exports more than 2 million bpd, only has four refineries with a combined capacity of 445,000 bpd, but they have never reached full production because of sabotage and poor maintenance.

The country currently imports the bulk of its refined products because its four refineries are only performing at 30 percent of their capacity.

However, Nigeria expects to complete an upgrade and refurbishment of its oil refineries by the end of 2012 to double throughput.

"As you know refinery projects are critical for the Nigerian state. More and more the government realises that it cannot do it all by itself ... so I think by the end of the year I think we will be in a position to go out to investors," Chukwueke said.

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