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NNPCL’s Pipeline and Depot Rehabilitation Set to Improve Nigeria’s Energy Infrastructure

In a statement promising to reshape Nigeria’s energy landscape, Olufemi Soneye, the Chief Corporate Communications Officer (CCCO) of the Nigerian National Petroleum Company Limited (NNPCL), has outlined ambitious plans for rehabilitating the nation’s pipelines and depots. This initiative is not just about maintenance; it’s a strategic move towards ensuring energy sufficiency and bolstering national infrastructure.

The ongoing project, which Soneye discussed in a recent interview, is expected to span two to three years. “We can assure Nigerians that the NNPC Ltd.’s pipeline and depot rehabilitation project is a game-changer in achieving Nigeria’s energy security and self-sufficiency in refined petroleum products,” Soneye stated. With a structured financial model, strategic partnerships, and committed execution, this initiative aims to resolve longstanding challenges in petroleum supply and enhance the country’s energy infrastructure for the long term.

The rehabilitation work is segmented into four lots, focusing on different geographical areas and aspects of the pipeline network. The first lot involves rehabilitating pipelines from Bonny to Port Harcourt, including depots in Aba, Enugu, Makurdi, and Yola, with significant progress already noted at the Port Harcourt terminal. The second lot is dedicated to the pipelines from Escravos to Warri Refinery, extending to Benin and Ore depots, where rehabilitation has enabled smooth product distribution. The third lot deals with the pipelines and depots linked to Kaduna Refinery, ensuring crude supply from Warri to Kaduna and product distribution to Kano, Gusau, Jos, Gombe, and Maiduguri, with assessments for full rehabilitation underway. The fourth lot focuses on the coastal pipeline network from Atlas Cove to Ibadan and Ilorin, promising a comprehensive upgrade to the existing infrastructure.

This project employs a Finance, Build, Operate, and Transfer (FBOT) model, where contractors finance the rehabilitation, operate the infrastructure for a period to recoup their investment, and then transfer ownership back to NNPCL. This approach contrasts with the funding of refineries, which relied on loans, indicating a shift towards more sustainable and innovative financing in Nigeria’s oil sector.

The benefits of this rehabilitation are manifold. Upon completion, Nigeria is poised to achieve sustainable crude oil supply to its refineries and seamless product distribution through pipelines. This would reduce reliance on truck transport, thereby cutting transportation costs and reducing road hazards. Moreover, this would lead to improved energy security, decreased fuel importation, and a step towards Nigeria becoming a net exporter of refined petroleum products.

However, the project faces its challenges, including limited financial resources and the need for significant security measures against pipeline vandalism, which has historically been a major issue in Nigeria. The NNPCL has acknowledged these challenges but remains optimistic, emphasizing the use of advanced technology to enhance pipeline security and prevent vandalism.

Soneye’s assurance comes at a time when Nigeria is striving to become a self-sufficient producer in the petroleum industry, leveraging the rehabilitation and modernization of its refineries and storage facilities. The NNPCL’s efforts signal a committed step towards not only meeting domestic demands but also positioning Nigeria as a significant player in the global energy market.

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