How Nigerian refineries lose N104.3bn in 13 months

Nigeria’s refineries have lost a total sum of N104.3 billion in 13 months while not processing any crude oil from the refineries during the period, the latest report of the Nigerian National Petroleum Corporation (NNPC) has revealed.
This is even as the Corporation has said its downstream subsidiary, the Petroleum Products Marketing Company (PPMC), recorded N234.63billion revenue from the sale of white products in March, representing a 24.7 per cent increase from the N188.15billion sales recorded in February.

According to a study of the revised consolidated refinery financial performance from February 2020 to February 2021, the plants continued to lose money on a monthly basis.

The NNPC is in charge of three refineries: Kaduna Refining and Petrochemical Company, Port Harcourt Refining Company, and Warri Refining and Petrochemical Company.

Going by the corporation’s figures, the refineries’ monthly operational expenses exceeded their income for the whole 13-month period.

The refineries’ consolidated losses in February, March, April, May, June, July, and August 2020 were N9.36 billion, N10.3 billion, N9.69 billion, N9.55 billion, N10.23 billion, N9.1 billion, and N7.1 billion, respectively.

The facilities lost N7.04 billion, N5.49 billion, N5.99 billion, and N8.28 billion in September, October, November, and December 2020, respectively.

The consolidated losses persisted in 2021, with losses of N5.37 billion and N6.88 billion in January and February of this year, respectively, according to the corporation’s most recent statement.

Because of ongoing refinery rehabilitation work, the three refineries processed no crude in February 2021, and their combined yield efficiency is 0.00 per cent.

Meanwhile, the March 2021 edition of the NNPC Monthly Financial and Operations Report (MFOR) figures, which were contained in a statement by the Group General Manager, Group Public Affairs Division of the Corporation, Dr Kennie Obateru, stated that the total revenues generated from the sales of white products for the period of March 2020 to March 2021 stood at N2.129trillion, where petrol contributed about 99.24per cent of the total sales with a value of N2.113trllion.

In terms of volume, the above value translates to 1.75billion litres of white products sold and distributed by PPMC in the month of March 2021 compared to 1.4billion litres in the month of February 2021.

This volume is made up of 1.782billion litres of Premium Motor Spirit (PMS) and 0.45million litres of Automotive Gas Oil (AGO).

Total sale of white products for the period of March 2020 to March 2021 stood at 17.374billion litres and PMS accounted for 17.265billion litres or 99.37 per cent.

The NNPC continues to diligently monitor the daily stock of PMS to achieve uninterrupted supply, effective distribution and zero fuel queue across Nigeria.

In the Gas Sector, a total of 222.74 billion cubic feet (BCF) of natural gas was produced in the month March 2021 translating to an average daily production of 7,183.33million standard cubic feet per day (MMSCFD).

For the period of March 2020 to March 2021, a total of 2,911.62bcf of gas was produced representing an average daily production of 7,409.60mmscfd during the period.

Production from Joint Ventures (JVs), Production Sharing Contracts (PSCs) and NPDC contributed about 63.23 per cent, 19.78 per cent and 63.99 per cent respectively to the total National gas production.