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NNPC budgets $741m to revamp Kaduna refinery



The Nigerian National Petroleum Company (NNPC) Limited on Thursday signed an agreement with Daewoo Engineering and Construction Nigeria Limited for the rehabilitation of Kaduna Refining and Petrochemical Company Limited.

The planned quick-fix repair of the Kaduna Refinery has a cost ceiling of $740.67m (N341.48bn as at Thursday’s official exchange rate of N461.04/$) and will be for a duration of 21 months.

NNPC is expecting that the Kaduna refinery will be restored to a minimum of 60 percent of its nameplate capacity by the fourth quarter of 2024.

Speaking on the agreement, Adeyemi Adetunji, downstream executive vice president of NNPCL, said at the contract signing ceremony that the quick-fix strategy guarantees the fastest route to restreaming the Warri Refining & Petrochemicals Company Limited (WRPC) and KRPC for in-country production of refined petroleum products.

He said: “Restoring WRPC and KRPC back to operation will guarantee energy security for the country, and reduce dependence on imported petroleum products in view of near total dependence on the supply of imported petroleum products and the impact the ongoing Russia-Ukraine war is having on global supply.

“Also, this will generate revenue, reduce demand for FOREX, supply raw materials to industries, create employment for Nigerians, and ensure technology transfer, amongst other benefits.”

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Adetunji said that the NNPC is using a combination of internally generated revenue and third-party financing to execute the refineries’ repairs.

He said that the post-rehabilitation of the three refineries (Kaduna, Warri, and Port-Harcourt), globally reputable operations, and maintenance contractors would be engaged to run the refinery safely, reliably, sustainably, and profitably.

“Meanwhile, the rehabilitation of PHRC has progressed considerably. The old refinery is currently at 64 percent completion and the plant is expected back in operation in Q2 2023, while the entire PHRC rehabilitation project now stands at about 59 percent.

“On the other hand, WRPC Quick-fix Project has achieved 28 percent completion and is expected to be restreamed by the end of this year,” he said.

In addition, Adetunji said that the board and management of NNPC Limited are fully committed to providing all the required support to ensure that the refineries are repaired and back in operation on cost and schedule.

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