Refineries get more financial powers
From Madu Onuorah, Abuja
A NEW financial regime has been designed for Nigeria's three refineries to enable them routinely carry out maintenance of the facilities without recourse to the Nigerian National Petroleum Corporation (NNPC).
Minister of State for Petroleum, Mr. Odein Ajumogobia, said the new financial regime would enhance the process of Turn Around Maintenance (TAM) and guarantee maximum efficiency of the refineries. These, he stated, are necessary to ensure regular availability of petroleum products in the country.
For now, the managers of the three refineries in Warri, Port Harcourt and Kaduna are not allowed, by the statues establishing them, to spend more than $50,000 for the maintenance of the plants.
Ajumogobia, who spoke yesterday at the Presidential Villa, Abuja, explained that the refineries are bedeviled with the problems of lack of maintenance and inadequate funding, which he said are responsible for their inefficiency.
The minister said: "There are many things required, a new governing culture. For example, the manager of the Kaduna Refinery, Port Harcourt Refinery or Warri Refinery cannot spend $50,000 to change a spare part on some components without approval from the headquarters and that takes time and it means you are not running efficiently.
"So, we are also addressing that and I hope to raise a memo to the Federal Executive Council (FEC) to allow the refineries some latitude in terms of the boards so that they can run like a business, and hopefully contribute to NNPC's profit.
"Unfortunately, we haven't had a culture of maintenance. And that cuts across not just the refineries but the country generally. To maintain current infrastructure is part of growth and development. If you don't maintain things when they are supposed to be maintained, they may be lost. The refineries fall into that category."
Ajumogobia lamented that the refineries "are in such poor conditions that unless you do a full rehabilitation, which is what we are looking at now, we are going to have this continued breakdown of the system. And this is what is happening with the refineries. If you look at other refineries in Ghana, a smaller refinery in Therma, it is older than our refineries but it is still functioning. Many of the refineries across the world are much older than our refineries but it is a very basic technology that are being used. In our case, it is simply the fact that they are not maintaining our facilities. But now, we are trying to ingrain that culture, to do turn-around maintenance when it is supposed to be done."
Meanwhile, FEC has approved N2.43 billion contract for the construction of emergency communications centres in the 36 states and the Federal Capital Territory (FCT).
The Council, at its yesterday's meeting, also approved $13.57 million for equipping and provision of communications infrastructure in the centres. The amount will be paid at the prevailing foreign exchange rate at the time the contract is finally awarded.
FEC also approved the new benchmark of 17 weeks for the process of award of contracts by ministries, departments and agencies that require only local bidding and 23 weeks for those that need international bidding as part of efforts to improve budget implementation and reduce the amount of unspent funds returned at the end of each fiscal year.
The approval by FEC was based on the report of the Bureau of Public Procurement (BPP), which had on Tuesday met with federal permanent secretaries as part of efforts to fast-track the budget implementation process.
Minister of Information and Communications, Prof. Dora Akunyili, told journalists at the end of the council session that during deliberations, "we found, through the presentation, that the time lag between conception and award of contract were too long for giving our people the dividend of democracy that they deserve. Council therefore decided that BPP should meet with the permanent secretaries yesterday (Tuesday), and streamline the processes within the law. They met and today (yesterday), the BPP Director-General presented to Council a graphic picture of the length of time required to prepare these contracts before they are given out for execution."
According to her, the Council expects "all contracts to be awarded before September. We have decided that all contracts will be awarded fast and processed according to the law. We may not even get to September. We are determined to ensure that these contracts are processed fast, awarded so that we will not have to return money by the end of the year and at the same time deliver to our people what they need to make life better for them."
