Petrolex to develop US$3.6bn oil refinery in Nigeria

Nigeria oil RefThe refinery project aims to reduce Nigeria’s oil import from international market. (Image source: Chad McDermott/Flickr)Petrolex Oil & Gas Ltd has announced that it is planning to build a US$3.6bn oil refinery in Nigeria, with a capacity of 250,000 bpd

In a statement to Bloomberg, Segun Adebutu, CEO of Petrolex, said that the company is working on the front-end engineering design for the project, with the construction being scheduled to be completed in 2021.

This is in line with Nigeria’s effort to end fuel imports from international markets and attract investors to invest in the country’s oil and gas industry.

In spite of being Africa’s major oil-producing nation, Nigeria doesn’t have adequate refining capacity. Therefore, the country has to import at least 70 per cent of its domestic needs.

The Nigerian government pledges to end import in the next two years by building domestic refining capacity. This government initiative has attracted companies like Dangote group to construct a 650,000 bpd oil refinery in the country.

In addition, Saipem SpA and other international companies are also in discussion with Nigerian government to rehabilitate the country’s three existing plants.

Petrolex has also developed a storage-tank farm and other mid-stream infrastructure worth US$330mn in the country. The inauguration of the tank farm and the commencement of the construction of the refinery is will be held by end of December 2017, said the source.

The tanks are connected to a pipeline at Mosimi, which is expected to transport products across Nigeria. The source said that Petrolex will take loans from Nigerian banks and international lenders to finance the refinery project.

The company also plans to develop a fertiliser plant and lubricants facility and a liquefied petroleum gas plant in the country, said Adebutu to the source.

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