Kachikwu: From 2016, Refineries Will Pay Directly To Federation Account.

Ibe Kachikwu, the group managing director of the Nigerian National Petroleum Corporation (NNPC), says from 2016, state-owned refineries will make direct payments to the federation account.
The refineries are subsidiaries of the NNPC, which is the body expected to make the payments.
But Kachikwu said the NNPC was adopting a plan that would give the refineries some sort of autonomy, without privatising them.
In a statement by Ohi Alegbe, the corporation’s spokesperson, Kachikwu was quoted as saying high level discussions are underway with local and international investors to bridge the perennial JV cash call funding gap.

“The new model is that refineries would now buy their own crude oil, refine it and make remittances to the federation account allocation committee (FAAC),” Kachikwu said.


“They would operate a semi autonomy system that would enable them to run in a profitable manner.”
Alegbe expressed the federal government’s readiness to raise funds from international investors and the private sector in 2016 to fund the joint venture cash calls between the NNPC and international oil companies operating in the country.
Kachikwu said the initiative is geared towards rebottling the government from bearing the burden of funding capital intensive projects in the upstream sector of the oil and gas industry.
The minister assured that the NNPC over 5000 kilometres of pipelines across the country would be privatized in order to enhance efficient management of the infrastructure, bringing pipeline vandalism to the barest minimum.

According to him, in 24 months, Nigerians would see a positive dramatic turn in the refinery model, to meet needs not only in Nigeria but in the West African sub region.
Speaking on the December deadline for the refineries, Kachikwu said the reports before him posit that, two of the refineries are likely to meet the deadline.
Kachikwu disclosed that a “clean Nigeria after oil initiative” would be introduced in 2016 to ensure all the IOCs operating in Nigeria would adopt global best environmental practices that would guarantee the sustenance of the flora and fauna of communities where they operate even after they are long gone from the country.
“I will engage the IOCs to stand up and get counted in the area of best environmental practices in 2016.
“This initiative would help the IOCs to maintain a cordial relationship with the communities where they operate and the communities too would be satisfied with the efforts at the end of the day.”