NNPC to Hand Over Warri and Kaduna Refineries to Private Operators for Revitalization

The Nigerian National Petroleum Company Limited (NNPC) has announced plans to transfer the operations of the Warri Refining and Petrochemical Company (WRPC) and the Kaduna Refining and Petrochemical Company (KRPC) to private operators. This move is aimed at ensuring the reliability and sustainability of these refineries, which are critical to meeting Nigeria’s fuel supply and energy security needs.

The NNPC made this announcement on its official website, outlining a detailed process for engaging reputable operations and maintenance (O&M) companies to take over the management of the two refineries. According to the NNPC, this initiative is part of a broader strategy to revitalize the country’s refining capacity and improve the overall efficiency of its petroleum sector.

The NNPC stated that the selection of private operators for WRPC and KRPC would be conducted through a three-stage tender process. This process includes an expression of interest, a technical evaluation, and a commercial evaluation. The company emphasized that it aims to leverage all possible opportunities, including the procurement of consumables, manpower management, computerized maintenance management software, and warehousing systems.

“The O&M contract scope of work shall cover, but not be limited to, the following: long-term and short-term production/operations planning; production and operations execution; monitoring, reporting, and optimization of operations; and maintenance planning and execution,” the NNPC explained.

As part of the tender process, the NNPC has set stringent financial and statutory requirements for interested bidders. Companies are required to submit audited financial statements for the past four years (2020-2023), including income statements, balance sheets, and cash flow statements. Additionally, bidders must provide evidence of their latest credit ratings from a recognized rating agency and demonstrate a minimum average annual turnover of at least $2 billion for the financial years ending in 2020, 2021, 2022, and 2023.

The NNPC also outlined several statutory requirements, including proof of company registration and incorporation, certified copies of statutory documents indicating the company’s ownership structure, and a detailed company profile. Companies must also provide a tax clearance certificate for the past three years (2021-2023), which must be valid until December 31, 2024.

The NNPC has provided clear instructions for the submission of documents, which must be completed online through the NNPC/NipeX tender portal. The deadline for submission is set for noon on Thursday, October 10, 2024. Following this deadline, the NNPC will hold a virtual bid opening session via Microsoft Teams, where bidders and external observers will be invited to participate.

In the event of any unscheduled holiday on the submission date, the deadline will be extended to the next working day. The NNPC assured that the EOI closing date and time would be adjusted accordingly.

The decision to hand over the operations of the Warri and Kaduna refineries to private operators comes after years of unsuccessful attempts by the Federal Government to revive these facilities. Both refineries have been largely inactive for years, with minimal progress made in restoring their full operational capacity.

By involving reputable private operators, the NNPC aims to breathe new life into these refineries and ensure they can meet the country’s growing demand for refined petroleum products. The success of this initiative will be crucial in addressing Nigeria’s ongoing challenges in the energy sector and reducing its dependence on imported fuel.