Investors’ interest in Nigerian refineries drag on FG’s stringent conditions

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Several global investors who have shown interest in investing in the rehabilitation and even building of refineries in Nigeria have been shut out on the back of the Federal Government’s firm stance on securitisation of the funding options for the would-be investors.

‎The Federal Government is seeking a guarantee and securitisation of funding options of would-be investors to ensure its prized assets are properly secured, a condition which some of the intending investors consider as stringent.

“‎Nigeria has stringent conditions, such as sovereign investment guarantee which ensures investors commit to terms of payments from the bank that is facilitating their investment to provide payment guarantee and assurance to the government, to ensure complexities that come with such investments are properly streamlined,” Rabiu Suleiman, an engineer and senior technical adviser to the minister of state for petroleum resources on refineries and downstream infrastructure, told BusinessDay.

Suleiman noted, however, that the Federal Government is discussing as well as exploring other funding options that could provide some measure of comfort to the investors‎ to invest in the refineries’ upgrade.

“The government is discussing other funding options with relevant government agencies concerned, such as the Federal Ministry of Finance, the Central Bank of Nigeria (CBN), the Debt Management Office, in a bid to explore options that could attract investors and lessen the burden of internal turnaround maintenance option being currently borne by the NNPC,” Suleiman said.

“The president feels ashamed that during his time as federal minister of petroleum, Kaduna and Warri refineries were

built. However, now he is the president, he is putting everybody to task to ensure that the refinery plants are brought back on stream for optimal performance,” he said.

‎Nigeria main refineries consisting of Warri, Port Harcourt and Kaduna are performing sub-optimally, which had seen … Read More...