Nigeria’s refineries suffered a combined loss of N108.29bn in 2020, compared to N162.22bn in the previous year, yet the refinery plants spent a total of N9.07 billion on salaries and other emoluments during the year 2020. The plants generated zero revenue as they failed to refine a single barrel of crude oil.
This data is derived from the audited financial statements released by the Nigerian National Petroleum Corporation on Wednesday, and published in the PUNCH newspaper.
Nigeria’s refineries refinery plants, which are located in Port Harcourt, Kaduna and Warri, have a combined installed capacity of 445,000 barrels per day but have been in a state of disrepair for several years.
Kaduna Refining and Petrochemical Company reported a loss after tax of N55.77bn last year; Port Harcourt Refining Company recorded N28.67bn loss; and Warri Refining and Petrochemical Company posted a loss of N23.85bn.
Salaries, wages and other fringe benefits paid to Kaduna refinery workers fell to N26.02bn in 2020 from N34.52bn in the previous year.
Port Harcourt refinery, one of Nigeria’s refineries, put its aggregate payroll costs (wages, salaries and allowances, redundancy and pension costs) at N22.55bn, up from N18.62bn a year earlier.
Warri refinery, another of Nigeria’s refineries, said its aggregate costs of employees, comprising direct labour cost and indirect labour and staff welfare cost, dropped to N20.51bn last year from N30.86bn in 2019.
“For the year 2020, the company did not earn any income through shutdown of the plants and the ongoing turnaround maintenance,” KRPC said.
According to the financial statements, the company relies on short-term funding from NNPC to meet its obligations as and when due.
The Federal Government had approved the sum of $1.5bn to rehabilitate the aging refineries and put them to productive and profitable use.
“Without doubt, if this plan is fully executed, the reoccurring losses will stop in the year 2023, which is the expected date of completing the phase one of the rehabilitation project,” it added.