The Africa Finance Corporation, (AFC) has signed a $35 million debt facility agreement with Waltersmith Refining and Petrochemical Company Limited, for a proposed 5,000 barrel per day (bpd) refinery project to be situated in Imo state.
The agreement, which was signed yesterday, expected to produce 5,000 bpd as early first quarter of 2020, would contribute 271 million litres of refined products annually. It would cater to states in the eastern region.
Speaking yesterday at the signing ceremony, the Chairman/Chief Executive officer Waltersmith refining and petrochemical company, Mr. Abdulrazaq Isa said, “The investment by Waltersmith, AFC and Nigerian content development and monitoring board (NCDMB) into this refinery project is clearly strategic and cannot be coming at a better time.
“On our part, we have been plagued by the frequent unrest in the Niger Delta area, which has hampered our production for a cumulative period of 747 days.
“This is equivalent to two years out of out 10 years of operational existence beginning in March 2008. Our investment in this project became imperative to enable continuous production from our upstream business all year round without interruptions arising from vandalisation of crude oil pipelines.
“In addition, Waltersmith will be able to contribute about 271 million litres of refined product annually to the Nigerian economy, serve as an import substitution for meeting domestic demand for petroleum products, create both direct and indirect employment opportunities as well as reduce the amount of foreign exchange demand on the country’s treasury needed to import these products.”
The NCDMB investment in the project was in line with the federal government initiative of enabling local refinery capacity in the downstream sector, as well as generating more employment opportunities for Nigerians.
The NCDMB also recognises the opportunity to create a long term multiplier effect on the Nigerian economy through the realisation of the project.
Furthermore, he added: “The AFC, a foremost Development Bank, has continued to demonstrate a strong commitment to infrastructural development in Nigeria and Africa.
“This is evident in the commitment and immense contribution they have made to the success of the development phase of the refinery project. In the course of out transaction, AFC has strengthened the risk management framework of the overall project, thereby ensuring timely delivery of project within budget.”
Speaking further on the sidelines of the event, he said, “It would take 18 months. It is a turnkey project and we have started counting down and the work has already started, and we are expecting to have the refinery commissioned in January or February 2020.”
On his part, the Senior Director Investments Group at the Africa Finance Corporation (AFC)Mr. Taiwo Adeniji said the AFC had been working with Waltersmith for close to four years in trying to get the project off the ground.
“We know that Nigeria spends an enormous amount of foreign currency in importing petroleum products.
“Companies such as Waltersmith are making an effort to reverse this trend of using our currency to reverse this strength of using our scarce foreign currency to import refined petroleum products deserve all our support and that is exactly what AFC is doing by supporting the development of this project.
“We have found Waltersmith a very credible company that deserves our support and we sincerely believe that this particular project would be the first phase of many more,” he added.