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Nigeria aims to revamp refineries, end oil-for-fuel swaps

Published 06/10/2020, 13:19
Updated 06/10/2020, 13:24
© Reuters.

CAPE TOWN, Oct 6 (Reuters) - Nigeria aims to end the
country's so-called oil-for-fuel swaps system in the near future
and rely instead on oil products from local refineries, which it
hopes to have running again by 2023, the head of Nigeria's
national oil company NNPC said on Tuesday.
The oil-for-swap deals, in operation since 2016, provide
virtually all Nigeria's gasoline and some of the diesel and jet
fuel. NNPC exchanges around 300,000 barrels per day of oil for
the imported fuels. While NNPC has refineries with a combined nameplate capacity
of 445,000 barrels per day, decades without regular maintenance
or investment leaves the oil exporting country almost wholly
reliant on imports for refined products. Nigeria
closed its ailing oil refineries in April until they can be
fixed. NNPC chief Mele Kyari told a virtual panel at the African
Refiners & Distributors Association annual conference that while
the swaps had saved the country roughly $1 billion a year, they
could soon be scrapped.
"I don't see an extension of that process in the near future
as we progress and transit into more production locally," he
said.
Kyari said he expected NNPC's refineries to be fully
revamped and running again by 2023. NNPC has said it will
partner with private companies to upgrade the refineries and
then run them as part of a drive to process its own oil and cut
reliance on imported fuels. "Our plan is to deliver all of them by 2023," Kyari said. He
did not name any companies that have expressed interest in the
upgrade and repair projects.
"Our banking partners are on top of this. It is a schedule
we have agreed with our partners and we believe we can deliver
on this," he said.

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