Description
Crude oil is the main stay of the Nigerian economy as at today. With the advent of discovery of Crude oil Nigeria has risen to be a world power among the oil producing communities in the world (OPEC) and the sixth largest producer in the world. Crude Oil which is also known as black gold is in its raw form and is of no economic importance in this state however, after crude oil has been drilled there are various means by which it is transported to the refineries either by rail as seen in developed countries or by pipelines as it is done in Nigeria.
At the refinery, the crude undergoes the process of fractional distillation and various processes such as the addition of additives, catalytic processes and further distillation processes to produce the various fractions which are of great economic importance such as- premium motor spirit (PMS) which is used to power motor vehicles and some generating sets in parts of Africa, gasoil (A.G.O.) which is used to power generating sets and some vehicles, dual purpose kerosene (DPK) used as domestic and aviation fuel, House hold kerosene (HHK), aviation turbine kerosene (ATK) strictly fuels for airlines, the fuel oils (FO) which includes the light and high pour fuel oils used for boilers and most industries, naphthalene also known as naphtha an important commodity for lots of industrial processes, the condensates, and the gaseous hydrocarbons which have been flared in Nigeria (in simple terms burnt off /wasted) and are very important components of cooking gases.
Nigeria on its own is made up of four refineries which include the old and new situated in Port Harcourt, Warri refinery situated in Delta state and the Kaduna refinery. Statistics revealed that as at today Nigeria consumes more than forty million (40,000,000) liters of premium motor spirit (PMS) per day and the figures keeps on growing.
As at today, the four local refineries are only able to produce a third of the total daily consumption which is allocated to some few marketers through PPMC allocations while the NNPC depends seriously on the major and independent oil marketers in conjunction with some other contracted companies to make up the remaining 70% short fall through importation.
This report examines the financial viability of importing five thousand (5,000) tons of premium motor spirit (PMS) monthly, storing and marketing same in the local market.
