Edo Refinery Decries Lack of Crude Oil Supply

Edo Refinery has lamented the ongoing shortage of crude oil supply, urging for measures to address the disruption and ensure steady operations.

Despite having a production capacity of 1,000 barrels per day and being fully operational, Edo Refinery and Petrochemicals Company Limited (ERPCL) – owned by AIPCC Energy Limited – has expressed worries about the persistent challenges in obtaining crude oil supplies.

The problem at hand follows shortly after an announcement from Dangote Refinery, which brought attention to the difficulties in acquiring crude oil caused by the Nigerian Upstream Petroleum Regulatory Commission’s (NUPRC) ineffective enforcement of supply.

The refinery’s operations are still being hampered by the fact that ERPCL has not received any crude oil from designated authorities, as sources report.

Edo Refinery management elucidated the significant operational hurdles resulting from inadequate crude oil supply during a press conference held in Benin City, Edo State last weekend.

Due to supply issues, the refinery has been unable to operate at full production capacity as it requires 1,000 barrels of crude per day. Segun Okeni, a representative of the facility provided this explanation.

Despite securing supply agreements with Seplat and ND Western since 2022, Okeni observed that the refinery has been unable to obtain the required crude due to bureaucratic hold-ups. He revealed that in 2021, ERPCL had contacted Mele Kyari – NNPCL’s Group Chief Executive Officer – after having numerous meetings and maintaining continuous communication; however, their request was left unanswered.

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Okeni stated that their chairman had personally led a delegation to meet with the CEO and top management of NNPCL on August 18, 2021. The purpose of the meeting was to discuss their interest in buying crude oil. Okeni also mentioned that they had submitted a formal request dated July 22, 2022.

In July of 2022, representatives from NNPC in Abuja and NPDC Benin inspected the refinery to ensure that it was mechanically prepared, according to him. ERPCL participated in a commercial negotiation session with NNPCL in September 2022 where they revealed possible crude supply sources for oil fields. Additionally, during March of this year, ERPCL updated the Ministry of Petroleum Resources about ongoing issues concerning crude supplies as well as future projects related to the refining process at their plant.

Despite conducting meetings, exchanging correspondence and discussing with NNPCL for three years regarding the supply issue, Okeni pointed out that the state-owned company has not taken any significant measures to address it.

ERPCL emphasized the importance of NNPCL and other manufacturers to establish adequate infrastructure for loading trucks in preparation for future demands.

Questioning the allocation of 30,000 barrels per day to Dangote and overlooking smaller refineries like Edo Refinery is viewed as undermining small businesses that contribute to economic growth.

Mele Kyari, NNPCL’s Group CEO was urged by ERPCL’s representative to intervene and instruct Nigerian Upstream Information Management System (NUIMS) for honoring the Seplat-ERPCL agreement. This will enable the refinery to initiate lifting of crude oil from Oil Mining Licence.