Indonesian firm plans refinery in Nigeria

July 31, 2017
PT Intim Perkasa Nigeria Ltd., a subsidiary of PT Intim Perkasa, Jakarta, has indicated interest in building a refinery in Nigeria.

Robert Brelsford
Downstream Technology Editor

PT Intim Perkasa Nigeria Ltd., a subsidiary of PT Intim Perkasa, Jakarta, has indicated interest in building a refinery in Nigeria.

The proposed 10,000-b/sd modular refinery would be built in Nigeria's state of Akwa Ibom, Nigerian National Petroleum Corp. (NNPC) said.

While NNPC did not disclose further details of the planned refinery, the state-owned company did confirm the project comes as part of the Nigerian federal government's initiative to expand the country's existing refining capacity through the use of modularly constructed refineries.

NNPC and its greenfield refinery department, which specializes in new refinery projects, would provide professional support to the proposed project in line with the government's policy on modular refinery construction, said Maikanti Baru, NNPC's managing director.

"On our end, we have embarked on [an] ambitious plan to fast-track programs to restore our capacity utilization from 30% to a minimum of 90% in the next 24 months," Baru said.

NNPC continues to work on securing financing as well as technical expertise from third parties to help bolster the 445,000-b/sd combined capacity of its three refineries, Baru added.

Given Nigeria's projected population increase by 2025, the country will require more than 40 million l./day of fuel to meet domestic demand, about only 50% of which NNPC's existing three refineries currently would be able to supply, Baru said.

Announcement of PT Intim Perkasa's proposed modular refinery follows a series of recent initiatives by NNPC to aggressively advance its rehabilitation-and-expansion program at Nigeria's state-owned refineries to meet the country's domestic demand for fuels and curb its reliance on foreign imports (OGJ Online, Jan. 24, 2017).

As part of its proposed $500-million rehabilitation program, NNPC in April 2016 launched a tender inviting bids from investors to become financial and technical joint venture partners for the phased modernization of its four refineries, which in addition to PHRC's two refineries, include Warri Refining & Petrochemcial Co. Ltd.'s 125,000-b/sd refinery in Delta State and Kaduna Refining & Petrochemical Co. Ltd.'s 110,000-b/sd refinery in Kaduna State (OGJ Online, Jan. 2. 2017).

The overall program calls for restructuring the refineries to operate as incorporated JVs, with NNPC holding 51% interest and its potential partner 49% interest. If selected, partners will agree to fund, rehabilitate, and jointly operate the refineries with NNPC for a defined period, and in return, receive all offtake and marketing rights to refined products to be sold primarily in the Nigerian market until each partner recovers its investment.