Waltersmith Petroman Oil Ltd. subsidiary Waltersmith Refining & Petrochemical Ltd. has let a contract to Velem—a joint venture of Lambert Electromec Ltd., Lagos, and VFuels LLC, Houston—to build a 5,000-b/d modular refinery at Ibigwe, Imo state, Nigeria.
Velem, which began work on the project this month, will provide engineering, procurement, construction, and modular refinery fabrication for the processing site that, once completed, will refine Nigerian crude from Ibigwe onshore field in eastern Niger Delta into marketable fuel products for the domestic market, VFuels said.
The project, which has been under development for 30 months, is scheduled to be completed within 18 months, the service provider said.
The contract follows the Nigerian Department of Petroleum Resources’ (DPR) granting of requisite licenses for the project to Waltersmith, which previously finalized equity and debt financing through local and multinational financiers.
DPR approved detailed engineering design for the modular refinery in 2016 and granted a license to construct in 2017, Waltersmith and DPR said.
The proposed project comes as one of many in the wake of DPR’s previous licensing awards to private investors to establish refineries in Nigeria as part of the federal government’s strategy to expand the country’s existing refining capacity through use of modularly constructed refineries. (OGJ Online, Jan. 11, 2018; June 22, 2017; OGJ, Jan. 2, 2017, p. 55).
Last year, Ibe Kachikwu, Nigeria’s minister of state for petroleum resources, said finance remains one of the major challenges facing most of the private firms previously licensed to set up modular refineries in the country (OGJ Online, Aug. 21, 2017).
Contact Robert Brelsford at [email protected].
