Over 20 new licenses expanding domestic refinery base
Sopuruchi Onwuka
The federal government has issued over 20 new refinery and gas processing licenses as the country battles to stabilize the domestic fuel market in the midst price jumps associated with reforms in the domestic downstream petroleum industry.
The licenses come as the direct results of intense jostling for niche opportunities as regulators and players in the domestic petroleum refining industry explore business case propositions and approvals for rapid expansion of the country’s refining capacity.
The rapid approvals also falls in line with the prevailing fuel diversification programme of the government conceived to provide multiple and affordable fuel options to tame prices and comply with new sustainability goals and standards that govern the industry.
According to the Authority Chief Executive of the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), Engr Ahmed Farouk, government has pumped out significant 20 licenses to different companies with proposal for scalable refining projects.
He said more licenses and approvals have also been issued to investors with gas processing programmes that would help boost production of different product specifications for diverse application.
Engr Ahmed who delivered a keynote address at the ongoing Africa Downstream Energy Week hosted by the Oil Trading and Logistics (OTL) in Lagos stated that over 20 licenses were given to entities with different levels of refining and gas processing projects.
He specified that his office has issued nine valid Licenses to Establish (LTEs), seven Licenses to Construct (LTCs) and four Licenses to Operate (LTOs) to investors with plans for modular refineries.
“Meanwhile, the gas sector holds a 16 BSCF/D Licensed processing capacity, 5 BSCF/D licensed transportation capacity and 1.5 BSCFD licensed distribution capacity. Each of the subsectors is expanding rapidly alongside the general transformation in the natural gas sector,” Engr Farouk told delegates at the conference.
He added that whereas the Dangote Petroleum Refinery and Petrochemical (DPRP) has commenced operations with production of some petroleum products, “supply from the Refinery will improve significantly when it is fully completed and licensed.”
Engr Ahmed said the NMDPRA continues to emplace all necessary measures for assurance of quality and safety in the industry, strategic stakeholder engagements, and provision of regulatory support to key government initiatives such as the Decade of Gas and Pi-CNG programs.
He declared government’s keenness to enable private players in the nation’s midstream and downstream petroleum industry contribute to the coordinated drive towards sufficient, affordable and sustainable energy for homes and businesses in the country.
He stated that all regulatory processes in the midstream and downstream petroleum industry have been enhanced to guarantee efficient issuance of licenses, permits and authorizations; adding that the measures were deliberately designed to align with the reform initiatives of Mr. President in the Midstream and Downstream sector.
In the last year, he told the delegates, the NMDPRA has revised and consolidated its regulations through strategic Industry stakeholder engagements with a view to streamline the regulatory framework for ease of compliance in the sector.
The steps, according to him, are complemented by issuance of relevant guidelines and automation of processes to strengthen regulatory clarity and enhance compliance; adding that the agency remains resolute and focused on leveraging regulatory framework for creation of extensive value from our crude oil and gas resources.
He pointed at “our mission is therefore to ensure that we provide outstanding enablers that support all investments in our sector in the next few years.”
He also drew attention to the urgent need for enhanced safety standards in the industry to address the concerns of the public on safety of operations in the sector.
