New Refinery Project to Begin in Nigeria After Dangote's
- The Abia State Government has announced plans to begin construction of another refinery in Nigeria
- The government said it has reached an agreement with NNPC Limited to ensure petroleum product allocation
- Once completed, the refinery will join the growing list led by the Dangote Refinery as Nigeria pushes to become self-sufficient
Legit.ng journalist Dave Ibemere has over a decade of business journalism experience with in-depth knowledge of the Nigerian economy, stocks, and general market trends.
The Abia state government says full construction of its 10,000-barrels-per-day modular refinery will begin in the second quarter of 2025.
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The State Commissioner for Information, Okey Kanu, announced the development while briefing journalists on the outcome of the State Executive Council (EXCO) meeting presided over by Governor Alex Otti on Monday.
Kanu said:
“This, of course, is as a result of the approval granted to HSI to operate the 10,000 barrels per day capacity modular refinery at the AIP site."
He noted that the state had completed payment of compensation to all affected landowners and had commenced bush clearing and preliminary site works at the location of the planned refinery, Punch reports.
The project is being implemented as part of the Abia Industrial and Innovation Park (AIP).
In a related move to ensure a consistent supply of petroleum products, Kanu disclosed that the state had engaged the Nigerian National Petroleum Company (NNPC) Port Harcourt refinery and NNPC Retail Management for petroleum product allocations.
The commissioner further disclosed that the Ministry of Petroleum and Mineral Resources had initiated a comprehensive statewide survey on solid minerals. The survey aims to evaluate the quantity and economic feasibility of deposits including limestone, kaolin, lignite, granite, lead, and zinc.
Kanu said:
"Once the study results are fully available, the state government will be able to identify which mineral resources to prioritize and open them up for interested investors to begin mining."
"In a demonstration of its commitment to climate action, Abia will participate in the United Nations Framework Convention on Climate Change (UNFCCC) in Bonn, Germany, from June 16 to 26, 2025. Kanu said the conference will allow the state to consolidate efforts on climate adaptation and develop a technical dossier on integrated response strategies, BusinessDay reported.
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Food security plans for Abia
Also, the commissioner mentioned that as part of its food security initiative, the state will launch its wet season rice farming programme through an In-Growers scheme.
According to Kanu, 8,500 hectares across Abia’s rice belt, mainly in the north, will be cultivated, beginning with verified cooperatives farming over 500 hectares in Ndi-Okereke, Abam, and another 150 hectares in Owerrinta.
He said:
“This move will be replicated at other state-owned rice farmlands in Bende, Mkpa, Ofeme, Ozuitem, Ndi-Okereke, and Ndi-Oji Abam."
FG moves to revamp Nigeria's refineries
The Nigerian government is focused on improving the country’s refineries and promoting the development of modular refineries to reduce reliance on imported petroleum products and increase local refining capacity.
Key government-owned refineries, like the Port Harcourt and Warri facilities, are being rehabilitated to restore their efficiency and boost production.
The government is also investing in modular refineries, such as the planned 10,000 bpd refinery in Abia State, which is expected to provide a more flexible and affordable solution to meet local fuel needs while stimulating regional economic growth.
These efforts are part of the government's wider energy policy, which includes issuing licenses for modular refineries and ensuring a steady supply of crude oil through the Domestic Crude Oil Supply Obligation (DCSO).
Despite challenges like funding and logistical issues, the government’s support for modular refineries through favourable policies and partnerships is a positive step.
Ongoing investment and collaboration with stakeholders will be essential for achieving energy security and strengthening Nigeria's economy.
Impact of functional refineries in Nigeria
Speaking with Legit.ng, Wale Ogundeji, an energy expert, said that the successful operation of both government and private refineries in Nigeria would have a major positive effect on the country's petroleum industry, economy, and everyday life.
He said:
"First, functional refineries would reduce Nigeria’s dependence on imported refined petroleum, helping to tackle fuel shortages and stabilize prices. This would improve energy security and ensure the country can produce its own fuel.
"Economically, operating refineries would create jobs and support growth in industries like transport and logistics. It would also help balance trade by lowering the need for expensive fuel imports, saving foreign exchange.
"For citizens, having access to locally refined fuel would mean a more reliable supply and possibly lower prices."
Ogundeji added that better refinery performance would drive economic growth, reduce unemployment, and improve infrastructure, leading to higher living standards for Nigerians.
3 companies get approval to construct new refineries
Earlier, Legit.ng reported that the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has approved the construction of new refineries.
The refinery licence was given to three companies, including MB Refinery and Petrochemicals Company Ltd.
The latest development is a welcome boost for Nigeria in its efforts to become self-reliant in petroleum products.
The article was updated with additional information by the head of the business desk, Victor Enengedi.
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Source: Legit.ng
