Economy
Forex crisis threatens modular refineries N25bn daily crude input
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Modular refineries in Nigeria are currently facing the threat of shutting down operations following their inability to access foreign exchange for the purchase of crude oil, a commodity priced in United States dollars.
Nigeria has 25 licenced modular refineries with a combined capacity of producing 200,000 barrels of crude oil daily.
Although not all of the plants are currently operational, it was gathered that the functional ones were increasingly finding it difficult to purchase crude due to the worsening foreign exchange crisis in the country.
Brent, the global benchmark for crude, traded at about $80/barrel on Sunday and had remained within that range for months.
With an estimated capacity of 200,000bpd, the modular refineries, if fully operational, would refine about $16m (or N25.14bn if Thursday’s official closing rate of N1,571/dollar is used.”
Annually, it means the modular refineries has capacity for about 73 million barrels annually, representing about $5.84bn worth of crude oil.
But the facilities, which produce Automotive Gas Oil, popularly called diesel, Dual Purpose Kerosene or kerosene, naphtha and black oil, are now finding it hard to make the refined products available to oil marketers for distribution to consumers.
They explained that the scarcity of dollars had made it almost impossible for operators to purchase crude oil, as the modular refinery players and oil marketers demanded for the sale of crude oil in naira from the Federal Government.
The modular refinery operators, who spoke under the aegis of Crude Oil Refinery Owners Association of Nigeria, also lamented that the Federal Government had not been able to keep its part of the bargain with respect to the provision of feedstock to local crude oil refiners.
Speaking with our correspondent on the matter, the Publicity Secretary, Crude Oil Refinery Owners Association of Nigeria, Eche Idoko, stated that modular refineries may close shop if nothing is done to ameliorate the situation.
CORAN is a registered association of modular and conventional refinery companies in Nigeria, while modular refineries are simplified refineries that require significantly less capital investment than traditional full-scale refineries.
Idoko said, “The purchase of crude oil in dollars is currently the major challenge to modular refineries. We buy crude in dollars and sell our refined products in naira, and this is a major challenge. And apart from that, where do you get the dollars to pay for the crude?
“You heard the Manufacturers Association of Nigeria crying out recently about the dollar saga. We have requested that crude oil be sold to us in naira. And when you do this, you ease the pressure on the naira and this will make our diesel cheaper.
“It will encourage more investors to build and patronise the local refineries. If you take petroleum products off the foreign exchange market, you would have helped the naira by 60 per cent.”
Asked whether the inability of modular refineries to source dollars for crude oil purchase was slowing down production at the plants, Idoko replied, “Yes. We’ve not been able to get enough crude and from the little that we see, we’ve not been able to get forex to buy them.”
On whether this posed a threat to the survival of the plants, the spokesperson of the group said, “Exactly, it is a threat to our existence and it also opens the country to the volatility in the international market.”
Although the association could not state the estimated volume of crude refined by modular refineries in Nigeria, it stated that operators in the sector could refine about 200,000 barrels daily if all of them were operating.
Idoko said, “Right now, I don’t have the actual volume of crude that modular refineries refine annually. However, it is important to state that what each refinery produces in a month is dependent on the amount of crude they are able to get.
“The government has not been able to fulfill its own side of the obligation by providing 60 per cent of the crude required by modular refineries, as captured in the Petroleum Industry Act. So a lot of modular refineries are performing below capacity.
“For instance, OPAC has a 10,000 barrels per day installed capacity, but the most they have been able to refine is like 3,000 to 4,000bpd. The Edo refinery has 1,000bpd, but sometimes they do just 500bpd. Aradel and Waltersmith are the ones that refine as much as 70 and 80 per cent of their capacities because they have their own marginal fields.
“Waltersmith has a capacity of 5,000bpd, while Aradel has 10,000bpd refining capacity. However, if all the modular refineries come onstream, all those that have been licensed so far, our crude demand would be about 150,000bpd and 200,000bpd.”
Nigeria currently has 25 licensed modular refineries. Five of them are operating and producing diesel, kerosene, black oil and naphtha. About 10 are under various stages of completion, while the others have received licences to establish.
Officials of the Federal Ministry of Petroleum could not be reached to tell whether the government would consider selling crude to the modular refineries in naira, as they had yet to respond to enquiries up till when this report was filed.
However, the Minister of State for Petroleum Resources, (Oil), Heineken Lokpobiri, recently confirmed the lack of crude to domestic refiners, noting that Nigeria’s inability to meet its crude oil production quota approved by the Organisation of Petroleum Exporting Countries was the major limiting factor.
Lokpobiri, however, stated that the government was working hard to meet the production quota in order to supply crude oil to local refiners as stipulated in the Petroleum Industry Act.
Meanwhile, Idoko noted that “the current NNPC boss, petroleum minister and NUPRC have all talked about the possibility of having some arrangements with us in naira. But that hasn’t been implemented. Our people still source crude from domestic producers in dollars.
“We buy crude in dollars and sell our refined products in naira. So it is not that we earn dollar proceeds. Our earnings from the sale of diesel, kerosene and black oil is in naira.
“The only dollar component is the sale of naphtha, but most of our refineries won’t sell naphtha, they put it back into the system and reproduce kerosene or diesel. So we still have to visit the Central Bank of Nigeria or domestic dollar market to source our dollars.”
Marketers react
Commenting on the development, oil marketers stated that the continued fall of the naira against the dollar was limiting the release of refined petroleum products from the modular refineries.
Marketers under the aegis of the Natural Oil and Gas Suppliers Association of Nigeria stated that operators of these refineries had stated that the country’s foreign exchange crisis had made it difficult to put a price on refined petroleum products.
They called on the Federal Government and NNPCL to start supplying crude oil to local refineries in naira, considering the persistent fluctuations of the dollar.
The President, NOGASA, Benneth Korie, who conveyed the resolutions of members of the association after their meeting in Abuja, stated that the government should peg the foreign exchange rate at N750/$ in order to enable refineries to start pumping out refined products.
“If for example crude is $80/barrel, we will have to convert it to naira and sell to Nigerians at the naira rate. Let me start by telling you the implications. The problem holding most of these refineries and modular refineries from coming up is the exchange rate crisis.
“So the answer to this is for the government to come out and tell Nigerians that this is how much the dollar is, not this forex rate we hear on TV. Let the government come out and tell us the rate, not the black market rate.
“I know our budget this year was benchmarked at about N750/$. So if the government can maintain the exchange rate at N750/$, heaven will not fall, whether there is inflow or no inflow. It is not the first time we are seeing the dollar at N400 and they (black marketers) are selling for N800.
“So let’s go back and try it, because if we allow this crisis to continue, the dollar may get to what we cannot handle; it may get to the point that all our food items could be sold at dollar rates if care is not taken.
“Therefore, let us go back to N750/$ as it was stated in the budget and work with that, so that the crude oil that will be sold to the refineries will be sold at the exchange rate of N750/$, and it should be converted and we pay in naira.”
Explaining further, he said, “If you are buying crude oil from the government, you pay in dollars, but how do you blend? How much are you going to sell your refined products when you don’t know how much the dollar is going to be tomorrow?
“So it will affect you as a businessman. But if we have one price from the government, then when you are buying the crude from the government or NNPC, you will calculate it based on the government’s rate, convert it to naira and then sell it to Nigerians in naira.
“But when you go to get dollars today and they say it is N1,500, how do you calculate? It creates confusion. So it is causing a problem. Let’s have one rate from the government and things will change positively.”
The NOGASA president went ahead to speak on refineries under the management of NNPCL, as he stated that the forex crisis was also affecting these plants.
“For the Port Harcourt refinery, they said it will come up, and they are also into the business of buying and selling, so if the dollar is not stable, be rest assured it is their problem too,” Korie stated.
When probed further on whether the forex crisis was a major factor limiting the release of products from the refineries, he replied, “For most of them, yes!. This is because you don’t know how much you are going to buy the dollar and so you cannot tell how much you are going to sell (your products). It (dollar) is not stable.”
Speaking further on modular refineries, Korie said operators in this space were finding it tough to source dollars to make crude oil purchase, stressing that the instability of forex had remained a challenge.
On modular refineries, the problem they have is that they do not know how much they will buy and you are selling to them at the dollar rate. If you go to any modular refinery to buy products, the products’ price will be the same at almost the same price as the one you import,” the NOGASA boss stated.
Economy
Over 5,000 fibre cuts recorded in six months – NCC
The Nigerian Communications Commission (NCC) has disclosed that more than 5,000 fibre-optic cable cut incidents were recorded across the country in the first six months of 2026, with road construction, excavation and related civil works identified among the major causes.
The Executive Vice-Chairman of the NCC, Dr Aminu Maida, disclosed this on Tuesday at a stakeholders’ workshop on the protection of fibre-optic cables during road construction, excavation and other activities in Nigeria.
Maida said the high number of incidents required stronger collaboration between telecommunications operators, road contractors, government agencies, regulators and security institutions to prevent further damage to critical telecommunications infrastructure.
According to him, many of the incidents occurred because of inadequate coordination among stakeholders involved in road and other construction activities. He said the consequences of fibre cuts extended beyond the immediate physical damage to cables, stressing that they could disrupt essential services and affect millions of Nigerians.
The NCC boss recalled the nationwide telecommunications disruption in February 2024, when fibre cuts, including those caused by road construction, affected one of the major telecommunications operators. He said millions of subscribers were unable to make calls, send messages or access the internet for several hours, while subscribers who moved to alternative networks caused congestion on those networks.
According to him, the incident demonstrated how damage to one network could quickly have wider national consequences.
“In the first six months of this year alone, more than 5,000 fibre cut incidents were reported from road excavation, construction, and related civil work. A damaged fibre cable is therefore not simply a cost to an operator, it is a cost to Nigerians and to the wider economy.
“Those affected were not numbers in an incident report. They were parents, businesses, workers, and citizens cut off from people and services on which they depended on,” Maida said.
He stressed that preventing fibre cuts should be prioritised rather than waiting to repair damaged infrastructure after incidents had occurred.
Maida said telecommunications operators must provide accurate information on the location of their infrastructure and respond promptly when contacted before construction begins. He added that contractors must check for underground infrastructure before excavation and make adequate plans for its protection.
The NCC chief also urged regulators and security agencies to provide guidance and ensure accountability, stressing that coordination should form part of the design and execution of every relevant infrastructure project.
He said the commission remained committed to working with public and private stakeholders to make coordination a standard practice in road construction and other civil works.
Earlier, the Director of Critical National Assets and Infrastructure Protection in the Office of the National Security Adviser, AVM Effiong Ewa, said the protection of fibre-optic infrastructure was a shared national responsibility.
Ewa noted that telecommunications infrastructure had been designated as Critical National Information Infrastructure, warning that negligence or interference that exposed the assets to damage could constitute an offence under Nigeria’s legal framework.
He called for strict adherence to established protocols, guidelines and procedures during construction and maintenance activities.
Also speaking, the Permanent Secretary, Federal Ministry of Works, Mr Rafiu Adeladan, said the ministry recognised that road and telecommunications infrastructure often operated within the same physical space.
He said excavation, grading, reconstruction, utility relocation and other road activities could inadvertently damage vital fibre-optic infrastructure where adequate coordination and precautions were not in place.
Adeladan called for stronger mechanisms for coordination and information sharing before and during road construction activities. He said road contractors, consultants and relevant agencies should have access to accurate information on the location of telecommunications infrastructure before excavation begins.
On his part, the Permanent Secretary, Federal Ministry of Communications, Innovation and Digital Economy, Engr Nadungu Gagare, said protecting telecommunications infrastructure was not the responsibility of one institution, but required collaboration among government ministries, regulators, security agencies, construction companies, utility providers and other stakeholders.
Gagare said the Federal Government had established a tripartite standing committee on the protection of fibre-optic infrastructure to strengthen collaboration and promote a coordinated approach to infrastructure protection.
He said the committee would also promote compliance with established standards and right-of-way regulations, improve information sharing and support measures to prevent avoidable damage.
The workshop, organised by the Federal Ministry of Communications, Innovation and Digital Economy in collaboration with the Federal Ministry of Works, NCC, Office of the National Security Adviser and Nigeria Security and Civil Defence Corps, is aimed at developing practical measures to protect fibre-optic cables during road construction and other civil works.
Economy
NRS boss, Adedeji under fire over Nigerian economy comment
Nigerians have tackled the Executive Chairman of the Nigeria Revenue Service, Zacch Adedeji, over his recent comment about critics of economic reforms under President Bola Ahmed Tinubu.
DAILY POST reports that in a viral video, Adedeji questioned critics of Tinubu’s economic reforms about what they would have done differently.
“That is what I get worried about when I listen to some people about the economy and everything.
“Just ask them, what would they do differently? Mr President, I don’t want you to wonder. You have elevated the system from what they know and wonder,” Adedeji told President Tinubu.
Adedeji’s comment triggered reactions from Nigerians on X.
Reacting, a development professional and former Director-General of the Bureau of Public Service Reforms, Joe Abah, described Adedeji’s comment as insensitive.
“If true, this is a deeply insensitive statement.
“But to answer the question of what I would have done differently, I can just look at the UK’s Andy Burnham, who is trying to tackle the cost of living.
“In just 19 days, he has removed the 5 percent VAT on domestic electricity (it is 7.5 percent in Nigeria); capped bus fares at £2 per ride by reimbursing private sector operators for the difference in real costs; pledged a 20 percent cut in business rates for pubs and clubs (an important part of British social life); maintained and adjusted Universal Credit to favour the poorest and most vulnerable.
“So, I would have used the increasing tax revenue to tackle the cost of living. That is what I would have done differently at my own level. Hope that helps,” he said on X on Saturday.
Similarly, a lawyer known, Vena Ikem wrote on X: “He should ask himself what all the millions of dollars he is spending mean to the tax he is collecting even from poor people. If karma truly fulfils, this man will get his just deserts in the land of the living. This arrogance is from getting away with stealing tax money.”
Also, Adekunle Oderinde wrote on X: “The entire convoy of Zacch Adedeji is more expensive and longer than the convoy of UK Prime Minister, yet he is talking about suffering Nigerians complaining about the effects of the policies of his principal, President Tinubu, who drives an expensive and long convoy on scarce resources.”
Economy
RMAFC gives NUPRC 48 hours to dissolve host community trust
The Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) has ordered the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) to dissolve a disputed Host Community Development Trust within 48 hours, following allegations that it was established without proper consultation with the affected oil-producing communities.
The order was issued during an investigative hearing in Abuja into the operations of Sterling Oil Exploration and Energy Production Company (SEEPCO) and the implementation of the Host Community Development Trust provisions of the Petroleum Industry Act (PIA).
Speaking at the hearing, RMAFC Chairman Dr Mohammed Bello Shehu said the Commission would continue to protect the interests of oil-producing host communities and ensure they receive the benefits guaranteed to them under the law.
According to a statement issued on Friday by the Commission’s Head of Information and Public Relations Unit, Maryam Umar Yusuf, Dr Shehu described the investigation as a national assignment aimed at promoting accountability in the management of Nigeria’s petroleum resources.
He said the Commission would continue to strengthen its oversight of oil companies and government institutions responsible for implementing the provisions of the Petroleum Industry Act, adding that transparency and accountability remain essential to protecting national revenue and restoring public confidence in the petroleum sector.
Dr Shehu commended members of the Commission’s Investment Monitoring Committee for their work and expressed optimism that the investigation would help ensure that host communities receive the full benefits provided for under the Petroleum Industry Act.
The Chairman of the Investment Monitoring Committee and Federal Commissioner representing Anambra State, Dr Ekene Enefe, led the investigation into SEEPCO’s compliance with the law establishing Host Community Development Trusts.
He said the era in which oil-producing communities endured environmental degradation and social hardship without corresponding development must end.
According to him, both petroleum operators and regulatory agencies must fully fulfil their legal responsibilities to affected communities.
The Committee also expressed concern about SEEPCO’s repeated failure to honour invitations to appear before it, despite earlier engagements.
Dr. Enefe warned that no operator would be allowed to evade legitimate oversight by the Commission.
Addressing officials of the NUPRC, he said RMAFC’s constitutional responsibility requires it to hold every institution in the petroleum industry accountable for the proper discharge of its duties.
He then issued a direct order to the regulator, saying: “We are going to give you 48 hours to dissolve that host community development trust.”
Dr. Enefe also faulted SEEPCO for what he described as its failure to meet obligations owed to host communities.
He said the company would receive a formal notice directing it to settle all outstanding obligations. “We are going to write them, and we are going to give them an ultimatum to pay up what is owed the host communities,” he said.
Enefe added that after completing its investigation, the Committee would forward its findings and recommendations to the appropriate authorities, insisting that the Commission would carry out its constitutional responsibilities without fear or favour.
Earlier, the NUPRC delegation, led by the Director of Host Communities, Mrs. Ufondu Ejiro, defended the Commission’s handling of the Host Community Development Trust.
She told the Committee that the trust had been legally incorporated, properly funded and established in line with the Petroleum Industry Act.
According to her, the Commission received and reviewed documents covering community consultations, governance arrangements, funding plans and Community Development Plans before approving the trust.
She also presented records of contributions to the trust and maintained that the regulator had carried out its responsibilities in accordance with the Petroleum Industry Act and the Host Community Development Regulations.
However, the affected host communities rejected the regulator’s position. Speaking on their behalf, legal representative Mr. Peter Chukwudi argued that several individuals presented as community representatives were not recognised by the affected communities.
He also disputed claims that adequate consultations had taken place before the trust was established.
Chukwudi questioned the level of development in the oil-producing communities despite years of petroleum exploration and urged the Committee to thoroughly investigate the issues raised by residents.
Also speaking, the Anambra State Commissioner for Petroleum and Mineral Resources, Prof. Charles Ofoegbu, called for stronger cooperation between the NUPRC and the Anambra State Government in verifying genuine community representatives and monitoring compliance with legal obligations.
He also called for greater openness in the calculation of statutory contributions, operational expenditure and the execution of community development projects, saying the state government has a responsibility to protect the interests of its oil-producing communities.
The Federal Commissioner representing Rivers State, Ambassador Desmond Akawor, said there appeared to be a communication gap between the regulator and state governments, adding that closer cooperation would improve oversight of petroleum operations.
He also expressed disappointment at SEEPCO’s absence from the hearing and urged all parties to cooperate fully with the ongoing investigation.
The Federal Commissioner representing Kogi State, Abdulazeez Idris King, questioned whether documents submitted by operators alone were sufficient to confirm that genuine consultations had taken place before community representatives were recognised.
Similarly, the Federal Commissioner representing Jigawa State, Hauwa Umar Aliyu, called on regulatory agencies to maintain professionalism, fairness and impartiality while carrying out their statutory duties.
She said regulators must inspire public confidence by giving equal attention to the interests of host communities as well as those of oil companies.
In his closing remarks, Dr. Enefe assured all stakeholders that every submission and documentary evidence presented before the Committee would be carefully examined before recommendations are made.
He said the Committee would continue its work until all relevant facts had been established, adding that the investigation forms part of RMAFC’s broader efforts to improve transparency, strengthen accountability and ensure that oil-producing communities receive the benefits guaranteed to them under the Petroleum Industry Act.
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