The federal government has announced plans to adopt the Dangote Refinery into the National Petroleum Policy

This they say, will add value to crude oil, reduce high dependence on imported petroleum products and conserve foreign exchange among other things

A delegation led by Petroleum Minister, Ibe Kachikwu, will visit the site today to inspect the project which is expected to take off in 2019.

The Dangote Refinery is a 2,100 hectre refinery expected to produce a 600,000 barrels per day output once in operation. Nigeria’s current largest refinery produces only 450,000 barrels per day.

The new petroleum policy by the federal government seeks to revamp the up, mid and downstream sectors of the industry to optimize crude oil production and refining for the benefit of the oil-dependent economy.

According to the policy reports, the petroleum industry has been laden with insecurities and policy loopholes or firm government involvement and had such limited private participation in the industry.

“Despite having large energy resources, Nigeria has become energy insecure exhibiting multiple dependencies on crude oil exports; product imports; and hydrocarbon based electric power industry. The oil world has now changed fundamentally and the old policy is no longer relevant to Nigeria’s future”, it read.

‘’Oil price has crashed and is forecast by the Petroleum Policy Team to remain at a median $45/bbl real for the foreseeable future. Production around the world remains high, combined with large inventories in storage and even in tankers around the world. The reality is that the world is awash with oil.

“There are forecasts that the world is now starting to enter a post-­ oil period. Oil demand growth is expected to be slower in the future than it has been in the past, and within the next twenty years, demand for oil may show absolute declines.

‘’The future for oil producers lies in value added refining and petrochemicals. The intention of this Petroleum Policy is to move Nigeria away from crude oil exports into value added activities in oil, namely refining and petrochemical industries; expanding from oil into gas based industrialisation. The long-term vision of the Nigerian petroleum policy is to become a nation where hydrocarbons are used as a fuel for national economic growth and not simply as a source of income.”

While some Nigerians are of the opinion that the government is taking an easy way out by latching on to the work of a private firm who is trying to outdo the government in providing infrastructure and means to enhance the product that is the mainstay of the economy, others believe governmnet involvement in the refinery is already a formular for its failure.

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