Make Downstream Sector Work Again, Stakeholders Task FG

Stakeholders in the oil and gas industry have challenged the Federal Government to immediately put necessary machinery in motion to ensure that the nation’s downstream sector of the oil and gas industry begins working again, in other to impact positively on the economy.

They gave the charge at the 5th International Conference on Gas, Refining and Petrochemicals organized by the Centre for Gas, Refining and Petrochemicals (CGRP), University of Port Harcourt, in collaboration with the Nigerian Society of Chemical Engineers (NSChE), held at the university campus in Port Harcourt, recently.

With the theme, “Towards A Robust Refining, Petrochemicals, And Gas Industry In Nigeria” the conference’s key objective was to proffer actionable solutions that could engender seamless operations of petroleum refining, petrochemicals and gas industry in Nigeria.

They insisted that policy makers’ and industry operators’ attention needed to be drawn towards making a paradigm shift from exporting crude to in-country processing, and also leaning more on gas and petrochemicals therefrom to drive industrialization in Nigeria.

In a communiqué at the end of the one-day international virtual conference, signed by the Acting Vice Chancellor, University of Port Harcourt, Prof Stephen Okodudu; Chairman of Governing Board, CGRP, Engr. Anthony Ogbuigwe; National President, NSChE, Engr, Onochie Anyaoku; and Ag. Director, Centre for Gas, Refining and Petrochemicals, Dr Ipeghan Otaraku, they commended the Federal Government in its drive towards repositioning the oil and gas industry, particularly the downstream sector, and commitment to passing the new Petroleum Industry Bill (PIB), lamenting that over $30billion was expended yearly on importation of petroleum products in Nigeria.

In their opening remarks, the Chief Host and Acting Vice Chancellor of the University of Port Harcourt, Prof Stephen Okodudu and the National President of the Nigerian Society of Chemical Engineers (NSChE), Engr. Onochie Azubuike Anyaoku, urged all stakeholders to join hands together to reposition the industry in order to add value to the nation’s economy.

The keynote address was presented by former GED Refining and Petrochemicals, NNPC and Chairman of CGRP Governing Board, Engr. Anthony Ogbuigwe.

In his paper presentation, titled, “The Gas Conundrum: The way out for Industrialization and Consumption in Nigeria”, the Managing Director, Nigeria Liquefied Natural Gas Limited (NLNG), Engr. Tony Attah, highlighted the role of gas in today’s energy mix, describing it as the bedrock of industrialization in Nigeria.

While the Executive Secretary, African Refiners and Distributors Association (ARA), Engr. Anibor Kragha presented a paper titled, “Getting the Petroleum Refineries back on stream: Sustainability and Socio-economic considerations”, the Group Chief Technical Officer, Notore Chemical Industries Limited, Engr. Bode Agagu, presented another paper titled, “Diversification of Petrochemicals Production in Nigeria: Overcoming the Challenges”.

No fewer than 292 participants, drawn from captains and operators of industry, including Nigerian Refining Companies, Nigeria Liquefied Natural Gas Limited (NLNG), Indorama, Notore), as well as academia, professionals, NGOs, and policy makers across the globe were in attendance.

Part of the communiqué reads, “Dependence on importation for our petroleum product needs is unacceptable and unsustainable because of its negative impact on scarce foreign exchange, the economy, loss of job creation opportunities.

“The advantages of local refining over importation of petroleum products are keys to improved security, saving of foreign exchange, industrial development, job creation, manpower development, industrial harmony and other environmental benefits.

“Privatization and Public-Private Partnerships (PPP) have proved to be excellent economic models as seen at Nigeria Liquefied Natural Gas (NLNG) Limited, Indorama Eleme Petrochemicals Limited and Notore Chemical Industries Limited.

“Government policy inconsistency and adverse socio-economic considerations are some factors that militate against setting up of private refineries in Nigeria.

“Nigeria, like other African countries, has not given sufficient attention to targeted and sustainable financing of the downstream sector.

“The demand for crude oil and other fossil fuels as energy sources have been on a steady decline over the years because oil is losing its energy value due to stringent environmental policies of governments of various countries.

‘The concept of Triple Helix – close co-operation between Academia, Government, Industry and Professional Bodies was pinpointed as the appropriate route to drive desired change in the downstream sector.

“Also, the required future outcome in tertiary education can only be achieved via curriculum change so as to produce the smart industry input.

Industry and Community harmony is enhanced through equity participation of the community as has been experienced in Indorama Eleme Petrochemicals Limited.

“The need for refinery upgrade and cleaner fuels infrastructure was fully highlighted. The demand for gas to produce more petrochemical products has been on the rise. Global climate change policies can impact on foreign direct investments (FDI’s) in gas, refining and petrochemicals operations.

“There is need for the harmonization of clean fuel specifications and tariffs across Africa to encourage inter-regional trade and address public health concerns. Gas has been described as the biggest opportunity in Nigeria for the future, and Hydrogen identified as the future of green energy.”

The conference further urged “the Presidency and the Ministry of Petroleum Resources to, as a matter of priority, discourage the importation of petroleum products. All efforts should be made to get the nation’s four refineries back on stream either through Public Private Partnership as in the NLNG model or privatization as in the Indorama and Notore models.

“The efforts of Dangote refinery are highly commended. Government should, therefore, offer every necessary assistance to facilitate its speedy completion and commissioning.

“Operators of the Downstream Industry should adopt reliability-centred maintenance practices (RCMP) as this will enhance their plants and operations for sustainable on-stream availability and high capacity utilisation.

“The Federal Government should ensure more private sector participation in the downstream sector to encourage effective harnessing of the nation’s gas and hydrocarbon potentials.

“The Federal Government should provide the enabling environment and policy initiatives for investors to engage in key infrastructural development that supports industrial growth in the Country.

“The Federal Government and the National Assembly should collaborate with International agencies, to pursue and implement Global Climate Change policies for clean fuels and renewable alternatives. Systematic and sustainable transition to cleaner fuels is an imperative to ensure public health.

“The Federal Ministry of Education and the National Universities Commission (NUC) should collaborate with the Universities to change curriculum to inculcate big data, digitization and artificial intelligence in learning and research. This will produce the needed manpower of the future downstream sector of the Oil and Gas industry.

“Academia and Industry should work together to harness the synergy of the Town-and-Gown concept especially in proffering smart solutions to industrial challenges.

“The Federal Government, security agencies and host communities should ensure a robust security architecture that can create a secured environment for investors and industrial security.

“Government should make all efforts to facilitate the availability of enough Natural Gas to support Indorama’s and Notore’s production of petrochemicals (polymers) and fertilizers, which are the engine room of both the industrial and agricultural sectors of Nigeria.

“The National Assembly and the Federal Government should speed-up the passage, signing and implementation of the Petroleum Industry Bill (PIB) so as to fast track growth of the oil and gas industry.

“The Federal Government should encourage foreign and local investors to achieve targeted financing of the downstream sector, especially the infrastructural development of the gas industry,” they added.

By: Nelson Chukwudi


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