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PENGASSAN says plants ran below efficiency levels
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NNPC confirms shutdown due to poor material balance
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Refined output worth less than crude input, causing losses
The President of the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN), Comrade Festus Osifo, has disclosed that Nigeria’s refineries were shut down because they were running at a loss, not because they had completely broken down.
Speaking on Channels Television’s Politics Today on Tuesday, Osifo explained that although the plants processed crude oil, the value of refined products did not match the cost of input, forcing the system to operate at a deficit.
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He stated, “The refineries were shut down not because they were not working, but because the material balance was poor. For instance, if crude worth about $10 million was supplied, the refined products coming out were valued at about $9.5 million. That meant continuous losses.”
The PENGASSAN leader, an engineer with over two decades of experience, stressed that there was a difference between equipment functioning and operating efficiently.
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According to him, the decision was taken after management discovered the imbalance between input and output.
In a recent engagement with the new Group Chief Executive Officer of the Nigerian National Petroleum Company (NNPC) Limited, Osifo said management confirmed that the shutdown was necessary to reassess operations and implement a more sustainable strategy.
He added, “Not that the refineries were not functioning at all, but they were not functioning optimally. At the end, when you are feeding in crude worth millions of dollars and getting less in refined products, you are running at a loss. That was exactly what happened.”
