By Kunle Kalejaye

‎The Petroleum and Natural Gas Senior Staff Association, PENGASSAN has tipped Port Harcourt Refining Company, PHRC for complete Turn Around Maintenance, TAM as it is key to the reduction of refined products importation into Nigeria.

PENGASSAN said that PHRC is also key to increasing and improving local refining capacity in the country; and conserving the nation’s foreign reserves and enhancing the naira value.

Commenting on the importance of the refinery and why it needs urgent TAM, PENGASSAN Rivers State chairman, Comrade Fidelis Ighodaye said PHRC is made up of two refineries.

“The old refinery commissioned in 1965 with current nameplate capacity of 60,000 barrels per stream day (bpsd) and the new refinery commissioned in 1989 with an installed capacity of 150,000 bpsd.

“This brings the combined crude processing capacity of the Port Harcourt Refinery to 210,000 bpsd. It has five process areas, with the new refinery made up of Areas 1 to 4, while the old refinery is Area 5.

“PHRC produces varieties of products including Liquefied Petroleum Gas (LPG), Premium Motor Spirit (PMS), Kerosene (aviation and domestic), Automotive Gas Oil (AGO – diesel), Low Pour Fuel Oil (LPFO) and High Pour Fuel Oil (HPFO), unleaded gasoline produced by PHRC meets international standard,” Ighodaye said.

Regrettably, Ighodaye noted that the two refineries in Port Harcourt have not been functioning at optimal capacity due to some challenges, which made Nigeria not to have derived full benefits of the hydrocarbon resources.

Some of these challenges listed by PENGASSAN include refusal by the government to carry out Turn Around Maintenance (TAM) on the refineries as at when due.

Expressing his opinion on the TAM on refineries in the country, the PENGASSAN National Public Relations Officer, Comrade Emmanuel Ojugbana, said that Nigeria’s quest to turn the tide of import-driven petroleum products and achieve self-sufficiency in local refining of petroleum products will be a forlorn hope if the refineries are in moribund state.

“The Refineries have severally suffered from irregular Turn around maintenance. While TAM is required once in every 18 months, the refineries have been without TAM for almost two decades and this has caused serious problem for their operations,” he stated.

It will be recalled that the government reached an agreement with the union on 7^th January, 2014 to commenced TAM on the PHRC but till date the process is yet to commence.

Thereafter the government changed its tactics that instead of carrying out TAM on the PHRC plants, it would rather rehabilitate the plants to enable it function at minimal capacity. Since the government reached decision, some quantum of money was released for the rehabilitation to be performed by the employees of PHRC.

Though PENGASSAN considered this as a betray of confidence on the part of the government, the union however, promised to make use of the advantage offered by the rehabilitation to prove to the world that the refineries was not a total waste and a drain pipe on the nation’s purse as earlier claimed by the government.

Welcoming the decision, the union said in a statement “Since the government has decided not to carry out TAM on the PHRC, we have also shifted our ground to welcome the rehabilitation as this will enable us prove to the world, especially Nigerians that the refineries are not drain pipe on the nation’s purse as those who want it sold want the people to believe.

“PHRC has proved that it can be operated effectively and efficiently by posting a net profit of N11.2 billion for last December, representing N8.2 billion or 250 per cent above the N3.2 billion posted by the company in preceding November 2014. This was attributed to the improved financial performance for the phased rehabilitation programme, which was done by the workers.

“Alongside the other two refineries in Warri and Kaduna, approval was given for an agreed quantum of fund to be injected monthly over a period of one year for PHRC upgrade and rehabilitation.”

PENGASSAN, however, said for the refineries to be operated at profit and delivered its benefits to Nigerians, government should be apt and prompt to the release of fund as a panacea to alleviate the drawbacks occasioned by the lack of TAM, adding, “there are competent workers in the company who can handle the upgrade and rehabilitation and in fact collaborate with the local contractors that can match the TAM.”

On challenges of crude supply to the refineries, the union added that PHRC plant is poised not only to produce but also to add the needed value to the crude oil and flood the market with refined products, adding that the adverse effect of rationing or not feeding the plant with crude oil is that the plant remains idle for long.

“When the plant is idle for too long, this breeds residual faults and problems whenever there is an attempt to start up, since the design of a refinery is better when it is continuously operated.

“There was a time when we challenge the government and even issue a strike threat if crude is not regularly supply to the refineries but this was not done. We are again demanding adequate and regular supply of crude oil to the four refineries, especially the PHRC where it could be better refined to a higher value considering the give away price of exporting crude occasioned by the plunge in global oil prices.

“We are also challenging the government to grant the company’s management autonomy for effective accountability while sustaining the rehabilitation process already initiated. If the company fails to pay back the funding (if granted financial autonomy) and refuse to make commensurate returns to the NNPC within one year, the government is free to apply appropriate sanctions,”‎ the union stated.

Unlike the other two refineries in Warri and Kaduna that have commercial department, PENGASSAN stressed that PHRC lacks such department to enable it reposition and effectively interface with its existing and potential customers as well as expand its frontiers in the quest for profitable and sustainable operations.

The workers, therefore, clamoured for establishment of a commercial department to complement the decision of the management to off-take its deregulated products to alleviate the problem of haulage which is confronting the company due to excess production whenever crude is supply.

“Lack of autonomy is another major challenge confronting the company. The board and management of the company and other subsidiaries of the NNPC are tied to the apron of the national oil company.

“The workers’ union argued that decision making and financial autonomy need to be granted to the board of management so as to facilitate effective and efficient operations of the refineries.

“The issue of security of oil and gas installations, especially the pipelines that supply crude oil to the refineries and those that carry refined products to depots should be seriously looked into, as this is another major challenge  that can hinder putting the PHRC into optimal operations.