THE Port Harcourt Refinery, located in the Alesa-Eleme community, continues to operate at a minimal capacity months after its commissioning. A visit by The ICIR reveals that economic activities have yet to resume optimally, contradicting claims by the Nigerian National Petroleum Company Limited (NNPCL) of full operational status.
Residents of Alesa-Eleme, who previously depended on the refinery for their livelihoods, report that business remains slow. Boma Dokubo, a local food vendor, recalls how, before the refinery’s collapse, she would sell out her meals to depot workers before midday.
However, the downturn in operations has left her and others struggling to make ends meet.
Community leaders also express concerns. The Secretary-General of Alesa-Eleme, Timothy Mgbere, states that while the refinery was once loading over 100 trucks of petroleum products daily, current output struggles to reach 30 trucks.
“If the depot is fully functional, only PMS will load hundred trucks and above. Currently, the refinery is struggling to load with many marketers unable to access paid products,” he said.
“NNPCL for more than a week now is unable to load 30 trucks (AGO, PMS, DPK) all products put together. How would you tell us it’s 100 per cent functional. We are in the community, and we know what’s happening”, Timothy noted, this was at the point when media reports indicate that the refinery had stopped operation.
Claims of full operation in question
The NNPCL commissioned the Port Harcourt Refinery on November 26, 2024, with promises of full-scale operations. However, an on-the-ground cehecks by The ICIR suggests that significant work remains incomplete. Despite official claims, skeletal loading and ongoing rehabilitation work indicate the refinery is not yet functioning at full capacity.
“We are not saying the refinery is non-functional, but the repairs are incomplete,” Timothy added.
Checks at the site confirm ongoing work.
“As an indigene, I can tell you what I have observed; loading has been skeletal. You cannot load PMS three trucks a day and you say the refinery is doing 100 per cent.
“If your output keeps coming three, five or seven trucks in a day, then there’s a question mark about the 100 per cent functionality as claimed by the NNPCL,” Timothy said.
Impact on petroleum supply and pricing
Findings show that the Port Harcourt depot, which supplies products to Makurdi, Calabar, and Aba, is not meeting demand. Many marketers have resorted to sourcing petroleum products from the Dangote Refinery instead.
The National Publicity Secretary of the Independent Petroleum Marketers Association of Nigeria (IPMAN), Chiedu Ukadike said, “Our findings showed the rehabilitation work is incomplete and loading is still skeletal, contrary to what we have been told.”
“We are currently not accessing products from the Port Harcourt refinery,” Ukadike had stated earlier in the year.
Although, shortly after a tour of the facility invitation was extended to former president Olugsegun Obasanjo, the Petroleum Products Retail Outlet Owners Association of Nigeria (PETROAN) noted that its members are now loading petroleum products from the Port Harcourt refinery.
Production and refinery capacity concerns
Despite reports of operational status, refinery insiders confirm that output remains limited.
The refinery, with an installed capacity of 210,000 barrels per day (bpd), is currently struggling to meet expectations. Insiders also disclosed that the refinery has been relying on Indorama Eleme Petrochemicals Limited for the further processing of Naphtha, raising questions about its ability to refine crude oil independently.
This development, petroleum experts say, will be causing intermittent glitch in the production which has overtime stirred criticisms with so many Nigerians cynical about the production level of the refinery.
Insider sources confided in The ICIR that although the rehabilitation work has been ‘fairly’ completed, the refinery still lacks capacity to meet with its crude supply with rehabilitation work still ongoing.
Energy analysts argue that the Port Harcourt Refinery’s delayed ramp-up is inadvertently boosting Dangote Refinery’s market dominance.
“The refinery is still at a completion stage,” said oil sector governance expert Henry Ademola Adigun. “What they have done have not worked effectively well. There are some setbacks to be corrected in the refinery for maximum production.”
NNPCL faces mounting scrutiny
Following criticisms over the refinery’s operational status, the NNPCL has been under intense scrutiny.
For instance, in a monitored interview on Arise Television on Thursday, November 28, the secretary of the Alesa community stakeholders, Timothy Mgbere, who appeared as a guest alleged that the 60,000 barrels per day had yet to become fully operational, contrary to the position of the NNPCL.
Reports surfaced that some of the fuel being sold was not newly refined but rather old stock stored at the facility for years.
“It is producing other additives and has not got to the level of petroleum production till the first quarter (Q1) next year (2025),” Adigun told The ICIR.
PETROAN’s spokesman, Joseph Obele, in November last year said that official communication indicated that fuel from the Port Harcourt Refinery would be sold at N1,030 per litre.
However, the NNPCL later stated that these were misleading claims and that its retail portal had not been fully opened for sales at the time. It clarified that bulk sales from the refinery had not yet commenced.
Shortly after, on December 21, 2024, the NNPCL said the Port Harcourt Refinery had commenced production after years of rehabilitation and began truck loading of petroleum products the same day, while noting that it was “fully operational”.
The Port Harcourt Refinery comprise two units, with the old plant having a refining capacity of 60,000 barrels per day (bpd) and the new plant 150,000 bpd, both summing up to 210,000 bpd.
The refinery was shut down in March 2019 for the first phase of repair works after the government secured the service of Italy’s Maire Tecnimont to handle the review of the refinery complex, with Eni appointed technical adviser.
The ICIR reported that the board and management of the NNPCL said the 60,000 barrels-per-day Port Harcourt Refinery was operating at 70 per cent of its installed capacity, with plans to ramp up to 90 per cent.
The NNPCL in a statement issued on Tuesday, November 27, said the refinery was producing the following daily outputs: straight-run gasoline (naphtha): blended into 1.4 million litres of premium motor spirit (PMS or petrol); kerosene: 900,000 litres; and automotive gas oil (AGO or diesel): 1.5 million litres.
The refinery also produces low-pour fuel oil (LPFO): 2.1 million litres and liquefied petroleum gas (LPG)
The clarification by the national oil company followed myriads of controversies that followed the official opening of the refinery with some information dished out by the NNPCL considered as half-truths and lies.
What to know about the Port Harcourt Refinery
The ICIR reported that NNPCL in 2021 used $1.5 billion on the financially battered Port Harcourt Refinery Company (PHRC), signing a contract with an Italian firm Maire Tecnimont S.p.A for the rehabilitation of the inefficient company.
Rather than privatise the refinery, the NNPCL has chosen to pump an equivalent of 4.5 percent of Nigeria’s 2021 budget into the refurbishment of a refinery that comprehensively lost N152.89 billion between 2017 and 2019.
Portharcourt Refining Company Limited (PHRC) is a refinery complex in Alexa-Eleme, Rivers State Nigeria that includes two oil refineries.
The refinery has a combined capacity of two refineries which is 210,000 barrels per day. The old refinery was designed to process 60,000 barrels per day of TNP- a blend of Medium Nigerian crude Oil, whilst the new refinery is capable of processing third party is capable of processing third party crude oil.
The rehabilitation work in 2021 was contracted to an Italian giant Technimont at the cost of $1.5 billion which the government announced has been was completed in November, but our findings in December showed truck loading and other economic activities are yet to pick up at the refinery.
Naphta is equally being refined (Naphta is the refining crude oil to various derivatives). It would be noted that the Naphta is currently heated with superheater with the help of Indorama Petrochemcial to a certain temperature for PMS to come out.
The Refinery is currently producing Naphta and Indorama Petroechemical is producing crack 65 for the refinery to enable a perfect blend of PMS.
“You need super heater to heat it to a certain temperature for PMS to come out,” a source with deep knowledge of the refinery who pleaded anonymity told The ICIR.
“What the refinery is doing now is Naphtha and Indorama is producing crack 65 for us. To get PMS, we are doing blending in partnership with Indorama nearby to us.
He added, “Other derivatives are currently being produced easily but the refinery has to rely on Indorama since it’s producing Naphtha to blend and get PMS.”
The ICIR findings showed that there’s pipeline linking Indorama and the refinery for the cracking since the super heater is yet not available.
Economic activities
Findings showed economic activities are still dearth around the refinery community, although there are hope of gradual revival with the refinery coming back to life.
For Chukwudi Ezeoba who has worked at the refinery as a sub-contractor with some indigenous company in the past, he has his doubts about the full coming alive of the Refinery.
“No, I don’t believe yet. I know how the Eleme axis used to be alive with lots of economic activities once the refinery comes alive fully. I had worked there before and I can tell you the economic strengths.
Like Chukwudi, most Nigerians are still cynical about the true picture of what’s happening at the refinery with their Nigerian government also struggling with some ‘vital information’.
Doubts persist over refinery viability despite NNPCL’s explanations
Former President Olusegun Obasanjo recently criticised the government’s handling of the refinery.
In a televised interview on Channels Television January 2, he disclosed that a proposal by Aliko Dangote to manage the refinery was rejected in 2007, with the government opting for NNPCL control instead.
He questioned the wisdom of continued state management of the facility given its inefficiencies.
The former President had criticised the functionality of the rehabilitated refinery and accused the Nigeria National Petroleum Company Limited (NNPCL) of lacking in capacity to manage the nation’s refineries.
“When I was president, I wanted to do something about the three refineries we have: Port Harcourt, Warri, and Kaduna. Aliko got a team together after I asked Shell to come and run it for us. And Shell said they wouldn’t,” Obasanjo said.
Communities alleged neglect
Community members remain concerned about the refinery’s employment policies and economic impact, although some roads are currently being rehabilitated.
A community development chairman in Okrika, Victor George, expressed frustration over a lack of job opportunities for skilled locals.
“I have worked as a contract staff at the refinery before the commencement of the rehabilitation. I have a machine fabrication experience and there are members of my community who are also trained in certain skills and need to be employed,” he lamented.
He said the community will officially write to the government relations representatives a the refinery and follow up with the employment complaints.
On the flip side, Nigeria’s average daily crude oil production increased significantly to 1.539 million barrels per day (bpd) in January, exceeding the Organisation of Petroleum Exporting Countries (OPEC) quota.
Harrison Edeh is a journalist with the International Centre for Investigative Reporting, always determined to drive advocacy for good governance through holding public officials and businesses accountable.