Nigerian Energy Stakeholders Call for FOREX Waivers for Modular Refineries
……Urge FG to divest from should divest from depots, address the dysfunctions of pipeline infrastructure
Energy stakeholders in Nigeria have appealed have appealed to the Central Bank of Nigeria (CBN) to create a special foreign exchange window to facilitate seamless operations for modular refineries in the Nigeria.
The stakeholders who were participants and delegates at the just concluded Nigerian Content Midstream and Downstream Oil and Gas Summit organized by the Nigerian Content Development and Monitoring Board (NCDMB), also encouraged relevant Nigerian authorities to adopt creative initiatives to address the nagging issue of irregular supply of feedstock to the modular refineries, which is hampering the smooth operations of the plants.
In the communiqué issued after the summit on Tuesday, the energy stakeholders further advocated that the federal government should divest from the petroleum depots and address the dysfunctions of Nigerian pipeline infrastructure.
They requested that the NCDMB should consult more with midstream and downstream stakeholders to co-produce solutions to the peculiar challenges confronting the sector. Their commendations were geared to address some of the challenges of the sectors, which were identified by the delegates.
Some of the challenges include “that the midstream/downstream sectors face uncertainty due to the sustenance of subsidies, inconsistent supply of feedstock, and the broken product distribution infrastructure,” the communiqué stated.
The stakeholders also highlighted the challenges that modular refinery operators face in sourcing FOREX and called attention to the hurdles and delays that complicate the process of operationalizing a valid import waiver.
The two-day summit received 11 papers and featured three-panel sessions and at the end came up with a few high-impact actions that would help to maximize the potentialities in the midstream/downstream sectors of the oil and gas sector.
One of the action items is an increase in NCDMB’s collaboration and alignment with other relevant ministries, departments, and agencies as well as stakeholders to mainstream Nigerian content bottom lines in refining, processing, storage, construction, fabrication, distribution, marketing, and retail to liberate the potential of the sectors.
They also pointed to the need to encourage accelerated investment in modernizing and up-scaling the local supply chain to ease petroleum product distribution and to formulate and implement policies and interventions to support indigenous operators and make them globally competitive in terms of quality delivery and product pricing.
They recommendation the need to incentivize the collocation of modular refineries and the depots and the Free Trade Zones to enable easy off-take of petroleum products and promotion of the utilization of gas as an energy source of choice in Nigeria and addressing the FOREX liquidity constraints of indigenous companies.
Participants at the summit observed that the midstream and downstream sectors have numerous leverage points to create value and these opportunities are yet to be fully explored.
According to them, the modular refineries could be “potential game-changers as they are well-suited to meet the demands for refined petroleum products in their catchment areas.”
The participants thanked the Board and its leadership for tenaciously building the momentum of Nigerian content and called on all stakeholders in the midstream and downstream sectors to support the progress achieved so far and ensure that they take the posture of good faith compliance with all Nigerian content requirements.
Delivering the vote of thanks, the NCDMB executive secretary, Mr. Simbi Wabote assured participants that their recommendations would be considered during policy formation. He also promised that the Board would liaise with relevant agencies to address some of the identified challenges that are outside the remit of the Board’s mandate.
“We would prioritize and try to unlock the challenges and continue to push the limits,” he concluded.