The Federal Government of Nigeria on Wednesday approved contracts for the rehabilitation of Warri and Kaduna refineries at a cost of $1.4 billion.
The money was approved at the Federal Executive Council meeting chaired by Vice President Yemi Osinbajo.
According to the Minister of State for Petroleum, Timipre Sylva, while responding to State House correspondents shortly after the meeting, the breakdown revealed that $897 million is earmarked for the Warri refinery and $586 million for Kaduna refinery.
Sylva explained that the rehabilitation of the refineries will be carried out in three phases.
The FEC also approved the $2.76 billion acquisition of 20 percent minority stake by the NNPC in Dangote Petroleum and Petrochemical Refinery.
Nigeria has four refineries, which included two in Port Harcourt – unfortunately they struggled to function optimally as the country continues to import petroleum products.
The rehabilitation is expected to turn around the refineries and set them up to meet national oil demands.
The Managing Director of NNPC, Mr Mele Kyari, in June submitted that the rehabilitation of the refineries, in conjunction with private efforts such as the Dangote Refinery, will transform Nigeria into a “hub of petroleum products and supply”.
According to him, “It’s going to change the dynamics of petroleum supply globally in the sense that the flow is coming from Europe today and it is going to be reversed to some other direction.
“We will be the supplier for West Africa legitimately and also many other parts of the world.”
The rehabilitation’s success is expected to have a positive impact on the street-level price of petroleum products such as petrol.
