Ministry, DPR Strategise On Modular Refineries


    Lagos – The Ministry of Petroleum Resources and Department of Petroleum Resources (DPR), have started negotiations, targeted at working out the modalities for the involvement of Niger Delta youths in the ownership and management of modular refineries.

    Prof. Yemi Osinjajo had in a recent visit to the Niger Delta, promised that the Federal Government would get the youths involved in refining instead of destroying their illegal refineries.

    Investigations showed that since the declaration, Dr. Emmanuel Kachikwu, Minister of State on Petroleum Resources and Mr. Mordecai Ladan, Director of DPR have been in discussion to work out acceptable modalities for the youths’ engagement.

    Kachikwu, who expressed interest in converting ‘illegal’ refineries to legal plants, did not respond to text messages or phone calls over the weekend.

    But a source in the ministry, who spoke on condition of anonymity, said the Minister of State has been meeting with the DPR director to agree on the best and practicable ways.

    “The Minister is interested and has been engaging with the DPR in order to agree on the number, locations and capacities of the modular refineries. The government’s role is to make policies as well as set guidelines for modular refineries and other issues in the industry. It should be noted that it does not control everything.

    “For instance, the government does not control 100 per cent the supply of crude oil produced by the International Oil Companies (IOCs) and indigenous oil companies. So, these and other issues have to be identified and worked out, otherwise the planned refineries will not have crude oil to refine legally,” the source added.

    Before now, owners of illegal refineries used to get supplies from illegal sources in the Niger Delta.

    They were also alleged to be involved in massive pipeline vandalism and oil theft, thus contributing to oil pollution in the region.

    Shell Petroleum Development Corporation (SPDC) disclosed in its latest report that security in the Niger Delta remains a major concern with persisting incidents of criminality, threats from militant elements, violent host community agitations and most recently, offshore piracy.

    It indicated that crude oil theft and related damage to oil and gas facilities in particular continue to present significant security concerns.

    The company stated that theft of crude oil on the pipeline network was 25,000 barrels of oil per day (bbl/d) in 2015, which is less than the 37,000 bbl/d in 2014.

    It disclosed that the number of sabotage-related spills declined to 93 incidents compared with 139 in 2014.

    The company stated that in 2015, the decrease in theft and spills was also in part due to divestments in the Niger Delta.

    It indicated that, theft and sabotage are still the cause of 85 per cent of spills from SPDC JV pipelines.

    “A key priority for Shell globally is to achieve the goal of no spills. Regrettably, in addition to spills caused by criminal activity there were 16 operational spills of more than 100kg in volume from SCiN facilities during 2015. This number is less than the 38 spills in 2014, partly due to divestments but also reflecting continued progress on preventing operational spills. The total volume of oil spilled in operational incidents also fell to 0.2 thousand tonnes from 0.3 thousand tonnes in 2014.

    “To reduce the number of operational spills, the SPDC JV is focused on implementing its ongoing work programme to appraise, maintain and replace key sections of pipeline. Forty-two kilometres (km) of flow lines and 12km of pipelines were installed in 2015 bringing the total distance of pipelines replaced over the last four years to more than 900 kilometres.

    “In 2015, we sustained surveillance efforts on the SPDC JV pipeline network to ensure that spills are discovered and responded to as quickly as possible. There are also regular over-flights to detect new theft points and we implemented anti-theft protection mechanisms on key equipment.

    “In 2014, the SPDC JV signed a series of agreements with communities in Ogoniland – which has seen some of the highest rates of theft in recent years – using the Global Memorandum of Understanding (GMoU) model.

    “Under these GMoUs the SPDC JV provides funding to support unarmed community patrols which report incursions and suspicious activity directly to the security forces,” it added.