Nigeria approves crude supply to Waltersmith refinery

Nigeria's President has recently approved the immediate supply of crude oil and condensate feedstock to the Waltersmith refinery following the successful commissioning of the 5,000 barrels per day modular refinery. CNBC Africa's Christy Cole sat down with Abdulrazaq Isa, the Chairman of the Waltersmith Group, to delve into the details of the project and the challenges faced during the construction process. Isa highlighted the importance of completing the refinery on schedule, despite facing significant hurdles due to the COVID-19 pandemic. He mentioned that construction was nearly complete when the pandemic hit, causing difficulties with bringing in necessary personnel for testing and commissioning. Isaac explained that stringent COVID-19 protocols were implemented within the facility to ensure the safety of workers and maintain progress on the project. He shared the complex process of obtaining special permission to bring in essential personnel to run the plant, emphasizing the dedication of the team to see the project through despite the challenges. When queried about the rationale behind investing in an oil project amidst global uncertainty surrounding oil prices, Isa shed light on the origins of the project. The decision to build a modular refinery stemmed from the need to address revenue losses of up to 30% due to pipeline vandalization and crude theft experienced by the company over the years. The refinery was seen as a strategic move to safeguard the upstream business and tap into the local market for refined petroleum products. Isa emphasized that the project was well-capitalized before the onset of low oil prices, enabling them to forge ahead with confidence. He expressed satisfaction with the project's success in meeting the demand for refined products in Nigeria and hinted at plans for expansion to cater to the growing market. Despite volatility in oil prices and challenges in the upstream sector, Isa remains optimistic about the prospects of their downstream business, citing robust demand and financial viability in the domestic market, particularly in the vibrant Southeast region. The Chairman revealed that customers are lining up to off-take their products, indicating a strong market reception and validating their investment decision. The Waltersmith Group is poised to capitalize on the promising market conditions and continue its expansion program to meet the escalating demand for refined products in Nigeria.