Why Amakpe refinery partners Akwa Ibom Government …Amanam

30 January, 2008 01:00:00 Anonymous

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The project had initially suffered a setback when the state government called off the widely-publicised ground breaking ceremony creating doubts about the feasibility of the project.
It insisted that there should be an MoU to secure its $10 million investment in the proposed refinery. Before the deal was finally signed in Uyo, the president and chief executive officer of Amakpe refinery, Usua Amanam spoke with ANIEFIOK UDONQUAK on why the partnership with the state government was critical to the take off of the project. Excerpts:

Much anticipation
There was a misunderstanding between the state government and the promoters of the project. Now everything is strengthened out. The state government is in support of the project. I think it is better to do it right. That is the whole idea that government wants. Government wants to do it right. I am not afraid that the state government is not going to be with us. It has invested several million of dollars.
The US government has invested several millions of dollars too. Equally, Nexim and Sterling banks are involved. It is a big project and we need to take our time to work with the government so that they can understand what we are trying to do.

Sabotage
The issue is that I live in the US. The government is here in Uyo. There is a lot of misunderstanding in between. I think it is a good idea that we start communication directly with the state government and the state government is communicating with us so that we can form a good partnership for us to build the refinery. This refinery is not really for me. It is for the people of Akwa Ibom State and Nigeria because they will the ones to work there. Moreover it will propel the establishment of over 500 small businesses.

After the MoU
We are planning to have the groundbreaking ceremony in February. The state government has agreed to do the ground breaking ceremony in February.

Employment opportunities

For the first phase, we intend to employ about 200 people. Remember that the project will expand to 12,000 bpd in about two years. Later it will expand to 30,000 bpd in five years time. By that time, we intend to employ about 1,000 people. We will be the greatest employers by any private industry in the state.

Challenges

We have good connections with the US government. I don't think we have financial difficulties. It is a start-up company, a new project. We have to invent new ideas to really put things in way that bankers will understand. That is why none of the 18 companies that the Federal Government issued with licences is able to compete but we are able to succeed because we have the connections.

Management and expertise

We are looking at the project from a different perspective from the way Nigerians refineries have
been managed. We have a special management team that has been running other refineries in the US. They would be coming here and would be working with us for seven years, during this time, would be training out people and sending them abroad to acquire specialized skills.

Sourcing for crude
The Federal Government gave me the licence to build the refinery. They have also given me the approval to lift crude from NNPC. So there won't be any problem on how to source for crude for the refinery.
The promoters of Amakpe refinery recently signed a Memorandum of Understanding (MoU) with the Akwa Ibom State Government to resolve ''nitty grity legal issues'' in respect of the project, as insisted by Governor Godswill Akpabio.
The state government had announced the cancellation of the foundation laying ceremony of the project which was scheduled to hold October 27 when it dissociated itself from the project.
At a media interaction, Akpabio said though the state governnment had deposited $10 million in a special account to be used for the purchase of the shares of the company, there was an urgent need for an MoU to spell out government's interest in the project, particularly on its investment and management of the project.
"We must have a percentage of the management. We must also have a say. There is no point going to dump $10 million into the project that is left in private hands alone without us having a say. We must also agree that we must not have only foreigners working there''.
According to the governor, once the MoU is prepared and both parties agree, the state government would sign it to show its readiness to partner with them and move the project forward.
He said though the state government had gone to court to obtain an injunction restraining the promoters of the project from touching any part of the $10 million(N1.2billion), ''they were now prepared to settle the matter out of court,'' adding that, ''there is no government that will not be interested in the project like a refinery no matter how small it is''
The governor acknowledged that the refinery when completed would assist in creating employment opportunities as well as contribute to the available of petroleum products particularly when most of the nation's refineries were operating below capacity.
The governor who said that the promoters of the project have now given an indication that the Exim Bank has approved the release of its funds for the project said the state government was ready to support the project ''but under an atmosphere where the interest of Akwa Ibom will be protected''.
He urged the people to be patient for the state government to resolve all the issues involved in the project, saying that it was proper to follow due process in the execution of the refinery project.
The Amakpe refinery located at Eket has a total installed capacity of 12,000 bpd. It is to be completed in two phases with the first phase expected to deliver 6,000 bpd by October 2008.

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