By Chineme Okafor in Abuja
Three of the refineries owned and operated by the Nigerian National Petroleum Corporation (NNPC) in Port Harcourt, Warri, and Kaduna, have continued to operate below their expected profit levels, the June 2017 edition of the monthly operations and financial report of the corporation has disclosed.
According to data in the report which was released by the NNPC recently in Abuja, the refineries produced just about 16.56 per cent of the total volume of petrol and kerosene consumed in Nigeria within the period under consideration, with the Port Harcourt refinery clearly the best of them all.
The report explained that while 1,205.97 million litres of white products were distributed and sold by the Pipeline and Products Marketing Company (PPMC) of the NNPC in June, about 1,124.15 million litres of petrol and kerosene were distributed with 186.26 million litres of them provided by the refineries.
It said: â€œThe petroleum products (PMS and DPK only) production by the domestic refineries in June 2017 amounted to 186.26 million litres compared to 222.02 million litres in May 2017
â€œA total of 1,205.97 million litres of white products were distributed and sold by PPMC in the month of June 2017 compared with 1,204.30 million litres in the month of May 2017.
â€œThis comprised of 1,083.91 million litres of PMS, 40.24 million litres of kerosene and 81.82 million litres of diesel.â€
â€œTotal sale of white products for the period June 2016 to June 2017 stood at 15.08 billion litres, PMS amounted to 13.20 billion litres and accounts for 87.51 per cent. While total special products for the month of June 2017 was 129.49 million litres comprising of 33.33 million litres of LPFO (Low our Fuel Oil) and 96.16 million litres of other special products,â€ it added.
Though the corporationâ€™s refineries have mostly operated below profitability levels, the report however affirmed that the NNPC in January 2017, adopted a Merchant Plant Refineries Business Model for its refineries, in which it takes cognisance of the products worth and crude costs.
According to it: â€œThe combined value of output by the three refineries (at import parity price) for the month of June 2017 amounted to N37.17 billion while the associated crude plus freight costs and operational expenses were N24.74 billion and N9.09 billion respectively.
â€œThis resulted to an operating surplus of N3.34 billion by the refineries. Also, during the period under review, refineries combined capacity utilisation was 12.73 per cent with PHRC (Port Harcourt Refining Company) recording the highest capacity utilisation of 26.98 per cent.â€
â€œFor the month of June 2017, the three refineries produced 222,585 metric tonnes of finished petroleum products out of 231,836 metric tonnes crude processed at a combined capacity utilisation of 12.73 per cent compared to 23.09 per cent combined capacity utilisation achieved in the month of May 2017.
â€œThe deprived operational performance is attributed to WRPC and KRPCâ€™s downtime during the month under review. The ongoing revamping of the refineries will enhance capacity utilisation once completed. Only PHRC was active during the month under review. WRPC was shut-down due to power failure,â€ the report addded.
Also on year – to â€“ date (YTD) revenue from crude oil export, the report stated: â€œTotal export crude oil and gas receipt for the period of June, 2016 to June 2017 stood at $2.52 billion. Out of which the sum of $ 2.16 billion was transferred to JV Cash Call in line with the budget and the balance of $0.36 billion was paid to Federation Account. Low receipt is due to twin effect of production disruption in Niger Delta and low crude oil prices during the period.â€