What are the implications of NNPC’s plans to rehabilitate the Port Harcourt refinery?
On average during 2020, Nigeria consumed 520,000 b/d of refined products, with nearly 80% imported and the remainder coming from non-refinery supply sources. Crude processing at NNPC’s refineries has been poor for many years, and effectively stopped in 2019. As such, Nigeria has been forced to sell crude oil overseas with refined products such as gasoline and middle distillates shipped back under direct sale, direct purchase (DSDP) agreements. NNPC is to remedy this situation by rehabilitating the Port Harcourt facility, and potentially the Warri and Kaduna refineries too. In early April 2021, NNPC signed an EPC contract with Maire Tecnimont SpA, an international engineering and construction firm, to bring Port Harcourt back online in a phased manner. With this extra capacity coming online, will Nigeria become a net exporter of refined products, so potentially shifting global product trade flows?