ekt_bear:

SPDC is already nationalized. Isn't 50%+ of it owned by the Nigerian government?

Anyway, I don't see how you can force them to sink money into a business that they have no interest in.

Nigeria wants refineries. So build it yourself, rather than forcing somebody else to make it for you!

Same way they want crude oil, they should also look somewhere else for it.

Who is the "they"?

SPDC is 50%+ owned by the Nigeria government. So if you are pointing fingers at them, then you must also hold the Nigerian government accountable for the lack of refineries, since it is the majority partner.

If what this guy is saying is true and they are selling their refineries abroad and many abroad are losing money, what good reason would they have for chasing refinery?

Who chooses unprofitable businesses to invest in?

Anyway, if you want to compel SPDC to build refineries, then you are asking the majority partner (Nigeria) to also pony up a lot of cash too.

Why is there LESS culpability and blame on the MAJORITY partner here? How and why is the minority stakeholder getting blamed more?

ekt_bear:

wetin concern building refinery with social responsibility? What the heck is social responsibility anyways? "Build this thing for us that we want, but are too lazy and/or incompetent to build ourselves?"

I mean, shouldn't we be embarrassed that everyone here seems to believe that the only way that there will be refineries in the country is if you ask Shell to build it for you?

Why doesn't Nigeria build refineries itself? Or hire out the task to somebody?

Nigerian government should not be involved in building refineries, that is not part of it's business. If you call yourself a multinational oil company and you are only interested in profiting from our raw materials when it is profitable for you, then it is up to Nigeria to look for other arrangements that are in the interests of Nigeria.

Aigbofa:

Same way they want crude oil, they should also look somewhere else for it.

And are they being gifted the crude oil for free?

You signed a contract with them to explore for oil. They put up all the money to do exploration, you put in nothing.

Yet you still make yourself majority shareholder. Afterwards, you want to renege on the original agreement and force the minority guy to again build refineries when:

(a) it wasn't part of the original agreement
(b) you as the majority guy should pony up more of the money for any new ventures.

sorry you are all a bunch of clueless sentimental blah blah.

1. Shell does not own refineries, the big oil majors have started dis investing in refineries years ago.
2. all those accusing companies of coming to third world countries to rip us off, why don't we keep our raw materials to ourselves
3. where are our indigenous companies that so love us that they open factories and refineries and sell at below cost.
4. and please don't anybody mention government run refineries.

http://www.bbc.co.uk/news/uk-16702584

Aigbofa:

Nigerian government should not be involved in building refineries, that is not part of it's business. If you call yourself a multinational oil company and you are only interested in profiting from our raw materials when it is profitable for you, then it is up to Nigeria to look for other arrangements that are in the interests of Nigeria.

Shell is not interesting in building refineries either. It doesn't want it to be part of its business any more.

Anyway, multinational oil company != refining company. . . just because you do the former doesn't mean you have to do the latter.

ekt_bear:

And are they being gifted the crude oil for free?

You signed a contract with them to explore for oil. They put up all the money to do exploration, you put in nothing.

Yet you still make yourself majority shareholder. Afterwards, you want to renege on the original agreement and force the minority guy to again build refineries when:

(a) it wasn't part of the original agreement
(b) you as the majority guy should pony up more of the money for any new ventures.

What part of your calculus account for the environmental disaster they leave in their wake? After all, osa ti o ba le gbemi ko fi mi sile bo ti bami

Look.

Shell doesn't want to build refineries. It isn't profitable for them. If you want to hold them at gunpoint to do it, I suppose that is an option.

A second option is to bring out your own wallet and write a check for your own refinery.

Or do whatever it was that enticed China to have interest in these new greenfield refineries.

But you cannot force a businessman to invest in something he doesn't want to invest in. He is the muthafuckin minority partner in this, and you want to make HIM build the refinery while you avoid it yourself?

That is messed up.

ekt_bear:

And are they being gifted the crude oil for free?

You signed a contract with them to explore for oil. They put up all the money to do exploration, you put in nothing.

Yet you still make yourself majority shareholder. Afterwards, you want to renege on the original agreement and force the minority guy to again build refineries when:

(a) it wasn't part of the original agreement
(b) you as the majority guy should pony up more of the money for any new ventures.

Actually, I don't blame the oil companies. They will sell Nigeria for money if were possible. You need to see what these people are getting away with in Nigeria! It is not like that in any other country in the world.

Apparently Mr Gej dint consult with potential refinery builders before coming out to lie to Nigerians that refineries will come quick afta subsidy removal

ojogbontomoye:

What part of your calculus account for the environmental disaster they leave in their wake? After all, osa ti o ba le gbemi ko fi mi sile bo ti bami

Who is the THEY?

There is no THEY.

SPDC is +50% owned by the Nigerian government. If there is any oil spill settlement, you can be damn sure that a big chunk of that money is going to come out of the Nigerian government's pocket. The FG has more culpability in those oil spills than even Shell does, simply because it has a larger stake.

How again is the 40% partner getting MORE blame than the 60% partner?

Implicitly here is a lack of faith in the Nigerian government's ability to do anything right.

If Shell says it doesn't want to build refineries, then hope is lost because we know that that is the more competent member of the partnership, despite being the minority one.

The tragedy of low expectations I suppose. . . when a government doesn't perform, then people reduce their expectations of it down to zero and place their hopes in Shell.

ekt_bear:

Who is the THEY?

There is no THEY.

SPDC is +50% owned by the Nigerian government. If there is any oil spill settlement, you can be damn sure that a big chunk of that money is going to come out of the Nigerian government's pocket. The FG has more culpability in those oil spills than even Shell does, simply because it has a larger stake.

How again is the 40% partner getting MORE blame than the 60% partner?

You are right. SPDC is partly owned by Nigeria. Nigeria should retrace her steps. We are in lose lose arrangement with shell in particular. The oil spill caused by shell cannot be cleaned up probably in 50 years. Yet, we are at the mercy of other oil producers, when Nigeria is a major oil exporter! It doesn't make sense.

When you allow your minority partner to enslave you due to your laziness, incompetence and greed, then this is what happens.

Wasn't it recently when someone in NNPC or something was saying "we plan on investing $100 billion in exploration over the next 5 years", something to that effect?

Ignoring the lack of plausibility of his statement for a second. . . where the hell is that $100 billion going to come from? Who is the "we"? What he is really saying is that his international partners will spend all the money on exploration.

So what sort of lazy mentality does the Nigerian government have that it says "we" when it is time to brag about what is being spent, "mostly me" when it comes time to share the money, then "you" when someone asks why there are no refineries?

And the worst thing about all of this is that you all encourage and empower them to have this pathetic mentality.

It is not Shell's responsibility to build a refinery for us. Stop blaming our laziness on foreigners.

Aigbofa:

You are right. SPDC is partly owned by Nigeria. Nigeria should retrace her steps. We are in lose lose arrangement with shell in particular. The oil spill caused by shell cannot be cleaned up probably in 50 years. Yet, we are at the mercy of other oil producers, when Nigeria is a major oil exporter! It doesn't make sense.

How much of the oil being exported is produced by the Nigerian Government?

ekt_bear:

SPDC is +50% owned by the Nigerian government.

I need to correct this. The Nigerian Government doesn't have a stake in SPDC. It has a 55% stake in the joint venture agreement with Shell and a few other operators.
For all intents and purposes sha your statement is pretty close to the truth. The Federal Government does have to pony up its share of the cash.

Depressingly, topics like this just goes to show how daft many people on Nairaland really are.
How can anyone in his right mind be exhorting the Federal government to compel tax-paying multinational oil companies (who are already under contractual agreements, pay hefty taxes and invest billions of dollars in Oil and gas exploration and production) to enter a loss making venture like refining?

Why is it beyond many Nigerians to carry out a simple research? Even with the internet at their fingertips, many people here have been so spoiled by years of copying handouts verbatim that they cannot even run a simple Google search to verify information received. A few minutes of googling would show you that not only Shell but most of all the other multinational companies are seriously divesting their refineries and selling them off to interested parties. And that's refineries in sane climes, not to mention this country where nothing works.


I shouted this same thing during the fuel subsidy debates. The Government told you dolts clear lies and people ate it up without question. Refineries are typically a low profit margin business. There's a reason why most of the oil companies are selling off most of their refineries. Read this

http://www.gtforum.com/gtf/research/2122391/refinery-divestments-story

Here's a quote from the article.

The IEA stated in its Oil Market Report, released October 12: “In the OECD, refinery consolidation continued apace, with refineries accounting for close to 1mbpd of primary distillation capacity completing or announcing extended shutdowns or refinery sales in September.
“Refinery margins deteriorated further last month, and were on average negative for 18 out of the 26 configurations surveyed.”

What this clearly says is that of 26 refineries surveyed, 18 were LOSING MONEY!
Shell, Mobil, Chevron et al are publicly traded companies and they owe it to their shareholders to maximise profit. Why should they now venture into refining in Nigeria? Why should they be forced to?

Anyone telling you that there will be a mad rush for private refineries is lying to you. Use your brains!

texazzpete:

Depressingly, topics like this just goes to show how daft many people on Nairaland really are.
How can anyone in his right mind be exhorting the Federal government to compel tax-paying multinational oil companies (who are already under contractual agreements, pay hefty taxes and invest billions of dollars in Oil and gas exploration and production) to enter a loss making venture like refining?

Why is it beyond many Nigerians to carry out a simple research? Even with the internet at their fingertips, many people here have been so spoiled by years of copying handouts verbatim that they cannot even run a simple Google search to verify information received. A few minutes of googling would show you that not only Shell but most of all the other multinational companies are seriously divesting their refineries and selling them off to interested parties. And that's refineries in sane climes, not to mention this country where nothing works.


I shouted this same thing during the fuel subsidy debates. The Government told you dolts clear lies and people ate it up without question. Refineries are typically a low profit margin business. There's a reason why most of the oil companies are selling off most of their refineries. Read this

http://www.gtforum.com/gtf/research/2122391/refinery-divestments-story

Here's a quote from the article.

The IEA stated in its Oil Market Report, released October 12: “In the OECD, refinery consolidation continued apace, with refineries accounting for close to 1mbpd of primary distillation capacity completing or announcing extended shutdowns or refinery sales in September.
“Refinery margins deteriorated further last month, and were on average negative for 18 out of the 26 configurations surveyed.”

What this clearly says is that of 26 refineries surveyed, 18 were LOSING MONEY!
Shell, Mobil, Chevron et al are publicly traded companies and they owe it to their shareholders to maximise profit. Why should they now venture into refining in Nigeria? Why should they be forced to?

Anyone telling you that there will be a mad rush for private refineries is lying to you. Use your brains!

kokoA:

It is not Shell's responsibility to build a refinery for us. Stop blaming our laziness on foreigners.

[size=18pt]RESOUNDING YES SIR !!!!

God bless you two. [/size]

texazzpete:

How much of the oil being exported is produced by the Nigerian Government?

I need to correct this. The Nigerian Government doesn't have a stake in SPDC. It has a 55% stake in the joint venture agreement with Shell and a few other operators.
For all intents and purposes sha your statement is pretty close to the truth. The Federal Government does have to pony up its share of the cash.

What is the relevance of your question? I am only interested in how much of crude produced in Nigeria is being refined in Nigeria.

AS far as your invective laden post is concerned, there is a reason a why you are not the president of Nigeria.

Nigerian Engineers have built refineries before, here in Nigeria. They are still alive, and are now even more experienced to do it better. Thank God its GEJ that's in charge.

These loss making refineries are located in regions without competitive advantage. We have excellent light sweet crude that's cheap to crack and can guarantee them attractive margins on lower feedstock prices if they are honest and willing. That man should stop being naughty and narrow minded and look at the big picture. When the global recession abates and consumption surges all those refineries will be fired up again. Our need for refineries is purely strategic, we don't need a CEO to tell us what we need.

Anyway he should chill out, China through CNOOC will do the businees and the gas reserves Shell is eyeing they will not get. Enough rubbish from them.

ckkris:

Nigerian Engineers have built refineries before, here in Nigeria. They are still alive, and are now even more experienced to do it better. Thank God its GEJ that's in charge.

Where? Which refineries?

Aigbofa:

What is the relevance of your question? I am only interested in how much of crude produced in Nigeria is being refined in Nigeria.

AS far as your invective laden post is concerned, there is a reason a why you are not the president of Nigeria.

yep. i'm not president of Nigeria because i'm too honest for that job. Seriously  

Reference:

These loss making refineries are located in regions without competitive advantage. We have excellent light sweet crude that's cheap to crack and can guarantee them attractive margins on lower feedstock prices if they are honest and willing. That man should stop being naughty and narrow minded and look at the big picture. When the global recession abates and consumption surges all those refineries will be fired up again. Our need for refineries is purely strategic, we don't need a CEO to tell us what we need.

Anyway he should chill out, China through CNOOC will do the businees and the gas reserves Shell is eyeing they will not get. Enough rubbish from them.

No matter what region you are in, refineries are generally a low profit margin business. Nigeria is not the only country with 'sweet' crude.
It would be better if you think your comments through BEFORE posting them. If refining Nigerian crude was such a profitable venture, why would any oil company run away from it? As it stands, the fact that none of the oil majors is willing to touch refining business in Nigeria should tell you that the profit margins are rather low and thus do not justify the investment level.

Nigeria's need for refineries may be strategic but the oil majors need to make profit for their shareholders. As tax-paying corporations that are under firm contracts, you cannot compel Shell et al to voluntarily enter a business that will not add value to their bottom line.

Finally, CNOOC belongs to the Chinese Government and can easily absorb any losses from refining business. Far more important to the Chinese government is resource and power grabbing. Every African would be wise to be wary of the chinese.

I weep for Nigeria  

Ordinary refinery   . Just pay the engineers and within 2-3 years you get a refinery. Before we know it, we are exporting fuel. Is this a rocket science for goodness sake? SMH

Texaspete, dem send you? Please enjoy Texas, where there is full current, clean water, etc. We're developing Nigeria through sweat and blood. Like Obama inspired Americans on that Nov 4 at  Grant Park, calloused hand by calloused hand. We're making slow progress here, without slave labour, without killing Indians.

Bleep SHELL, IMAGINE THE NONSENSE, NA GEJ I BLAME, MEND WILL KEEP BOMBING YOU TILL YOU CLOSE SHOP, FUCKING LEECHES

This CEO's comment shows how far we are irrelevant in business world. How can we expect Shell to build refinery for us? The fact that he has d audacity to utter did testify 2 our failure.

Since the licence is usually renewed after a while, we can introduce a new clause that ensures our major explorer commit to building a world standard refinery for renewing thier license.

don't we realize that a refinery would have been built long ago if Shell wanted it built?
of course it's not profitable for Shell so they won't build it. Nothing good for Nigeria is every profitable for Shell.

It's up to the Nigerian govt to find a way to build one.
why must Shell always make national decisions for us

His reason may sound lame but i dont think shell should be compelled to build a refinery for Nigeria. What happened to government investing in citizens to build those refineries? I know Nigeria has some indigenous oil companies but it is not enough. Go to Canada and you'll see enough indigenous oil and gas companies. The likes of Shell and co are like small boys sef. When you look at people's cv's you'll see they've moved from Shell to other companies and you'll be wondering why cos in Naija Shell is one of the majors. Shell shouldn't be mandated to build anything for us. Let us build our own. Imagine if we had more Nigerian oil companies and refineries, just imagine.

as for the image above that took almost the whole space on this page. No comment

I'm sorry but I can't see a country industrializing and developing on the back of imported oil. It will not happen. There is absolutely nothing wrong in refining. It is strategically important. Indonesia used to be a member of OPEC but pulled out when it became a net importer of crude on the back of its economic growth and industrialization., i.e. it refines every barrel of oil it produces for itself. That is where we should be heading. If Shell believes it is our portion to remain a honey pot, a raw material exporter, slaves to them for all eternity then they have miscalculated and are speaking to the wrong people. Their exploitative and feudalistic model under whatever guise is past. Their lies will no longer hold. If they are not prepared to partner Nigeria to realise its aspirations they should start divesting now and give others the benefit of doubt because when this government retires they will see in the Delta what they have never seen before. Enough is enough.