Nigeria's Modular Refineries Proposed to Help Reduce Refined Product Imports

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Witten by Richard Finlayson, Senior International Editor for Industrial Info Resources (Sugar Land, Texas)--The establishment of 12 modular refineries in the core Niger Delta states is being proposed by Chief Wellington Okirika, former chairman of Delta State Oil Producing Areas Development Commission, reports Vanguard.

The refineries in the states of Delta, Bayelsa, Rivers and Akwa-Ibom would enable the deregulation of the downstream sector of the petroleum industry.

Okirika said that modular refineries provide a quick way to reduce the importing of refined petroleum products into Nigeria, which is a major oil-producing country.

The production from the modular refineries and the three existing refineries in Nigeria would meet domestic consumption and leave surplus product for export. Modular refineries are small or medium refineries that are manufactured in modules in the U.S. and Europe, and then transported and assembled at sites for the production of refined products, petroleum products, petrol, kerosene and diesel, he said.

The Niger Delta has a comparative advantage in the establishment of refineries because of its crude oil base. The best option would be to establish two or three modular refineries in the core states of the Niger Delta, which would total 12 refineries with a total capacity of 240,000 barrels per day (BBL/d) of refined petroleum products.

Okirika said that the main objectives and attraction of modular refineries are the short time frame and low cost of establishing them. Production can start with modular refineries within 16 months with complete funding, whereas traditional refineries can take up to eight years to come online. A 20,000 BBL/d modular refinery would cost between $200 million and $250 million, while a traditional refinery takes billions of dollars of investment.

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