Senate to probe N11.35 trn spent on refineries rehabilitation
The Senate noted that despite the moribund state of the nation’s four refineries, their operating costs between 2010 and 2020 were estimated at N4.8 trillion Naira.
The Senate on Tuesday constituted an ad hoc committee to investigate all contracts awarded for the rehabilitation of the four moribund refineries in the country.
The Deputy Senate President, Barau Jibirin, who presided over the plenary set up the committee after Sunday Karimi (Kogi West) moved a motion to investigate the turnaround maintenance projects of Nigerian refineries to forestall waste of public resources.
Mr Jibirin appointed the senator representing Kogi East, Isah Jibrin, as the committee chairman while the chairmen of the Senate committees on petroleum resources downstream; upstream; gas; finance; appropriation, and public accounts are members.
Other members of the committee included Abdullahi Yahaya (PDP, Kebbi) Adamu Alero (PDP, Kebbi), Ifeanyi Ubah (APC, Anambra) and Mr Karimi (APC, Kogi)
He also directed that the committee should submit their findings to the Senate within four weeks.
Two of the nation’s four refineries are located in Port Harcourt, Rivers State, one in Warri, Delta State and one in Kaduna.
Mr Karimi, while presenting his motion said that from 2010 till date, the Nigerian government had spent N11.35 trillion on contracts to rehabilitate the four refineries, but they are still unproductive.
“Between 2010 to date Nigeria is estimated to have spent N11.35 trillion (N11, 349, 583, 186, 313.40) excluding other cost in other currencies which include $592, 976, 050.00 dollar, 4, 877, 068.47 Euros and 3, 455, 656.93 Pounds, on renovation of refineries, yet they are unproductive,” he said.
Mr Karimi, the chairman of the Senate Services Committee, said despite the moribund state of the four refineries, their operating costs are estimated at N4.8 trillion.
He said, “Despite the moribund state of the four refineries, the operating costs of these refineries between 2010 and 2020 is estimated at N4.8 Trillion Naira. The refineries are estimated to make a cumulative loss of N1.64 Trillion, within four years.
“Concerned that the Federal Government of Nigeria has carried out rehabilitation projects in Port Harcourt Refinery Company (PHRC) over a period of seven (7) years from 2013-2019 at an estimated cost of N12, 161, 237, 811.61 only, in addition, on the 18th March 2021, a rehabilitation Contract was executed between NNPC/PHRC and Tenenimont SPA at a Lump Sum of $1, 397, 000, 000.00 only, about N75 billion naira amidst global public criticism.
“Phase 1 of the Project is expected to be completed in 28 Months after the contract, Phase 2 within 24 months and Phase 3 within 44 months of execution. Despite this, the Port Harcourt
“Refinery remains a money pit. Going by projections and representations from NNPCL the renovation works ought to be completed and operations of the Refinery commenced by June 2023.
“Perturbed that in a bid to revitalize the Warri Refinery, the Federal Government has injected huge Public funds into revamping Warri Refinery & Petrochemical Company limited to the tune of over N28, 219, 110, 067.10 between 2014 and 2019.”
The senator, therefore, prayed the Senate to investigate all contracts awarded for the rehabilitation of the refineries during the period under review to prevent corruption in the sector.
When the motion was thrown open for debate, many of the senators supported it.
Adams Oshiomhole ( APC, Edo North) urged the Senate to unravel the main reason why the four refineries became moribund despite the huge amount of money allocated for its renovation.
“The Senate must ensure proper oversight functions to make sure that Nigerians enjoy value for their tax. We need to unravel while the refineries that were working before suddenly became moribund.
“Senate will do justice behind it to account for how much they have paid out and what they had done so far. The amount so far spent on the refineries can build brand new ones. Senators must take the issues with all seriousness they deserve,” he said.
Mr Aliero said the refineries had remained moribund despite huge sums spent on turnaround maintenance.
He alleged that the conditioned nature of the refineries was a deliberate sabotage by some persons who wanted to continue petroleum products importation into the country.
Others who contributed to the motion are, Aliyu Wadada (Nasarawa West), Ita Williams, (Cross River Central), Isah Jibrin (Kogi East), Olalere Oyewunmi (Osun West), and Adeola, Olamilekanm (Ogun West).