Thursday, May 6, 2021

Minister of petroleum, Sylva reveals why FG is spending $1.5bn on Port Harcourt refinery

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The Minister of State for Petroleum Resources, Timipre Sylva, has stated reasons for the Federal government decision to spend $1.5bn for the rehabilitation of Port Harcourt refinery, adding that his ministry is expected to generate $600million from its new Marginal Fields.

 

The minister made the disclosure at the fifth edition of the Special Ministerial Briefings coordinated by the Presidential Communication Team, held at the Presidential Villa, Abuja, yesterday.

 

Sylva confirmed the process for the acquisition of the marginal fields had been completed, revealing that there were 161 winning bids all notified.

 

“We have started to receive signature bonuses paid by the winners.

 

At least from the last account report I got from DPR, almost 50 per cent of the winners have paid. What we are expecting from the whole process is about $600million.

 

“And of course, we have also given allowance for people to pay in Naira so you have to pick which currency to pay in – in Naira or dollars.

 

“So, at this point we cannot give any figure in any currency but just to tell you that payments have been encouraging and they have up to April 20, 2021.

 

“So, there is some time although the jury is still out but we believe that by April we would have got a lot of them to pay,’’ the minister said.

 

On why the government is investing $1.5billion on rehabilitation of Port Harcourt Refinery when at the same time it is talking about privatization and commercialization of the oil and gas industry, the minister said.

 

“I have always said that our refinery cannot survive with the regime of subsidy; because you cannot be refining at a cost and selling at a subsidized rate.

 

“Now that constraints will be taken away by deregulation – that is the more reason why we must fix our refineries so that our refineries can now function optimally.’’

 

The minister maintained that it would be better for government to privatize a functional refinery as it would fetch more revenue for the treasury.

 

“A functional refinery will definitely fetch more for the government than a non-functional refinery.

 

"That’s why we feel that we gave to rehabilitate this refinery and then the government will later decide on whether to privatize, whether to commercialize.

 

“But at this point we want to give Nigerians a functional refinery,’’ he said.

 

According to him, the government resolved to rehabilitate the refinery based on the recommendations of experts.

 

 

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