The Nigerian National Petroleum Corporation (NNPC) Thursday presented its budget to the House of Representatives, marking the first time the state-owned firm would do so in its 43 years of operation.
It had in June published its audited financial statements for the first time ever also.
Mele Kyari, the NNPC chief, told the lower legislative chamber that all the refineries had been closed down because vandals and thieves were hindering efforts to supply crude to the plants.
“Day before yesterday, the House achieved a milestone by the passage of the PIB for second reading without any hindrance. We have all been witnesses to what has happened in the last 13 years. PIB was submitted five times to the parliament,” said Musa Sarkin-Ada, chair of the joint House Committees on Petroleum Resources (Upstream, Downstream and Gas) for budget defence.
“Most of the time when it came, it was dead on arrival, except when it came from a private member bill from the Senate, which was not assented to by the President, which was as good as not born.
“Going by what had happened initially, most of the problems came from the NNPC. They considered PIB as something that could undermine them and take away what they call privileged rights.”
11 out of NNPC’s 13 pipelines spanning more than 5000 kilometres have been shut down.
“We have 12 fuel depots. I can tell you today that except the Atlas Cove-Mosinmi-Ibadan line and the Port Harcourt-Aba line, none of these pipelines is active. None.
“We cannot flow products into these lines and the reason is very simple.
“The cheap one is to say they have aged but that is a very insignificant reason.
“The real reason is that the level of vandal activities on these lines, on all the pipelines, without exception, is gross, monumental and profound.”
Kyari said Nigeria lost petroleum products estimated at N43 billion in the first half of last year on one line. He added that the loss had been pared down to N3 billion.
“As I speak to you, we deliberately shut down all the refineries – all the three – because it does not make any further sense to continue to operate them for two reasons: we are unable to supply crude oil to the refineries.
“Except the Escravos-Warri line which we managed to sustain through this contracting process that we have, and Bonny-Port Harcourt refinery, it is practically impossible to run these pipelines at their optimum capacity.
“The lines, as a result of the acts of vandals and thieves of all sorts, anytime we attempt to pump more than 110000bpd into the Escravos-Warri line, the line gives up. Therefore, you cannot practically operate Kaduna and Warri refineries with the current structure of the pipelines,” Kyari said.