The Magic Behind The Steady Supply Of Petroluem Products (1)

By

Muhammad Al-Ghazali

ghazalism@gmail.Com

   

In the past fortnight no issue has captivated the attention of Nigerians more than the important milestone of President Muhammadu Buhariís first 100 days in office as the democratically elected leader of the nation. In the rabid debates that have ensued, opinions were sharply divided between those who insist on holding the president to account for the many things he allegedly promised to deliver with the period, and those who swear that he gave no particular deadline to deliver on anything.

As could be expected in any public debate in the post-Jonathan era, not a few commentators especially those sympathetic to the opposition, still appear to be shell-shocked at the outcome of the elections. Slander, invariably floored commonsense in their jaundiced contributions to what, ordinarily, should have been a civilized discourse determined by facts and available statistics. Even so, a few facts were generally thought to be incontrovertible for their prevalence in the last 100 days, by an overwhelming majority.

Those facts include, the widely acknowledged improvement in the electricity supply situation in the country; the steady availability of petroleum products at the approved pump prices, as well as the undeniable progress in the ongoing military effort to degrade the capacity of Boko Haram to wage war on the country, which has seen the cowardly terrorist group resort to sneaky attacks on soft targets in the Northeast.

The fourth, and arguably the most significant achievement, was succinctly captured by my good friend the Special Adviser to the President on Media the other day. The piece he wrote to commemorate his principalís 100 days in office titled ďA new Sheriff is in townĒ, Femi Adesina, correctly attributed the modest progress that has been achieved so far to attitudinal change we have witnessed in the conduct of public officers to the aura of competence and incorruptibility President Buhari has brought to the corridors of power in the past three months.

And one area in which the presidentís aura and body language appears to have produced significant results is in the oil sector, particularly in the sudden turn-around in the fortunes of the nationís refineries. Only yesterday, the Kaduna refinery was reported to have resumed production, almost three months after the successful Turn-Around Maintenance (TAM) of the one at Port Harcourt.

When all the refineries are fully back in production, the nation should be able to meet a large percentage of its daily domestic consumption requirements. The improved supply of petroleum products in turn is expected to impact on almost every sector of our economy including our capacity to generate sufficient gas to feed our thermal power stations.

Already, the long fuel queues Nigerians had become accustomed to in the recent past which paralyzed economic activities for prolonged periods, have disappeared, along with the perpetual threats from fuel marketers who held the previous government to ransom whenever they wanted for the non-payment of their subsidy rents. A chance meeting with a reliable insider with the Port Harcourt refinery in particular provided me with multiple and spectacular perspectives on how the remarkable improvements were achieved.

I was told, for instance, that before the outcome of last presidential elections, morale of the management and staff of the nationís four refineries was at rock bottom. They were aware that a large colony of emergency contractors that lived on the rent from the dubious oil subsidy regime had not only evolved over time, but were also incredibly influential. They almost determined how the sector was regulated.

The same oil marketers also knew that their very survival depended on the total collapse or dysfunctional national refineries to justify the fuel import regime. The various unions were aware of this. They also knew that the Jonathan administration had no inclination to repair the refineries. In fact, the former president was predisposed to sell-off the refineries, and even to have a clear strategy on how to achieve the goal using the dubious privatization program.

Using the profoundly corrupt but deadly efficient Nigerian privatization template, the refineries, which, under normal circumstance, were supposed to undergo TAM every two years, were allowed to rot and decay with the ultimate goal of selling them off as scrap to carefully chosen proxies. Those plans failed because of the close scrutiny of industry experts, including opposition from the various petroleum industry unions whose members would have been speedily laid off if the sales had gone ahead.

 

Having failed in the effort to sell-off the refineries, the same unions were left perplexed when, suddenly, in the lead-up to the last general elections, a plan was hatched out of nowhere to conduct the Turn-Around-Maintenance (TAM) of the Port Harcourt refinery which was neglected for more than six years at the astonishing cost of 297 US  dollars. Mercifully, the plan failed to sail only because of the security concerns raised by the same Italian company selected for the job. Luckily for Nigerians, President Jonathan lost the elections in spectacular fashion.

With the specter of the potential sale of their beloved refinery suddenly removed, a combined team of local contractors and indigenous engineers in the Port Harcourt refinery, commenced the TAM of the facility on the 14th of May, 2015 even before the Buhari administration was inaugurated under its current management led by the Managing Director Engr. Bafred Audu Enjugu who was appointed to the post in March, 2014. The team successfully completed the job in July. Even more significantly, the entire repair of the refinery cost the nation less than 10 million dollars!

The two Port Harcourt refineries, I reliably gathered, are well ahead of schedule towards achieving their installed capacity for refining a combined total of 210 barrels of crude oil per day following their successful TAM. They are also on scheduled to commence the production of high-grade jet A1 aviation fuel this month. When the upgrade is completely, the refinery will have the capacity to produce 700 million liters of aviation fuel annually.

Presently, the refinery is supplied with crude from barges through the Okrika jetty, but plans are also at an advanced stage to rehabilitate the dedicated pipelines laid to supply crude to the facility. Like the refinery itself, the pipelines also suffered from vandalism and neglect in the past.

My source was full of praise for the current Management of the refinery particularly the new MD who has shunned the hotel suite he is entitled to and now lives permanently in Life Camp in the refinery complex from where he monitors the improvement efforts round the clock.

The MD also earned the respect and affection of his colleagues through the various change management initiatives he introduced to transform the refinery from a major cost center to one that is also capable of operating like a commercial enterprise. Key to those initiatives has been the recourse to the automation of key processes and staff motivation through various welfare platforms, including the rejigging of shift system that has enhanced individual staff productivity by three hours.

Needless to add, of course, that the management of the refinery is lucky because the new Group Managing Director of the NNPC, Dr. Emmanuel Ibe Kachikwu is someone whose private sector mentality is considered a monumental asset that will be crucial in the comprehensive reform of the sector. Without his support and encouragement, I reliably gathered, the current efforts to infuse life into the refineries using local content would have been complicated.

Femi Adesina may have been too modest to state the obvious, but the election of President Buhari, also triggered a virtual domino effect which has generated its own momentum. The momentum has delivered a devastating uppercut to all nuances of incompetence and mediocrity in appointments to public offices in the current dispensation.

When a leader is not corrupt, or susceptible to corrupt influences, he is able to do the right things such as the appointment of the right people to fill important public institutions. Inevitably, his appointees also know that they must avoid putting round pegs into square holes. As we await the next Petroleum Minister, the ongoing reforms in the sector which is reliant on the use of our local engineers and contractors for the overhaul of the refineries has already inspired confidence.

It is a win-win situation for the country.