Nigeria: Transcorp, Oando, Others Line Up to Buy PH Refinery
Daily Trust (Abuja)
March 21, 2007
Posted to the web March 21, 2007
Anas A. Galadima
Two Nigerian companies, Oando and Transcorp were among eight bidders lined up yesterday by the Bureau of Public Enterprises (BPE) for the purchase of federal government's shares in Port Harcourt Refining Company Limited (PHRC).
The firms jostling to buy 51 per cent or more in PHRC are Refinee Petroplus/ Transcorp Consortuim, Oando Plc, Global Oil & Energy, Bluestar Oil Services, Indorama International Finance and Linkglobal International. The others are Essar Infrastructure and Mittal Investment.
A statement from the bureau said yesterday in Abuja that the firms are currently conducting the necessary financial law compliance checks, known as "due diligence" and will have site visits of the PHRC facilities.
The BPE had to reissue a call for interested companies to come forward last year.
The statement which was signed by the BPE's Head, Public Communications, Chigbo Anichebe, said: "The previous bid process was stalled due to multiple memberships in bidding consortia by a technical partner which would have led to the disqualification of most of the bidders. Consequently, the Technical Committee of the National Council on Privatization (NCP), directed that a fresh request for proposal (RFP) be issued to bidders 'after further clarification on the bidding procedures.'
After this extension, Oando and Transcorp entered the bidding, he said.
Mr Anichebe explained that by the January 19, dead-line, six bids were received from the following prospec-tive investors: India-based Mittal Investments Ltd, Indorama International Finance Ltd, Global Oil & Energy, LinkGlobal Inter-national Ltd, Taleveras Group Oil Works Ltd (DFP project Finance Ltd).
"After evaluation, Mittal Investments Ltd, Indorama International Finance Ltd, Global Oil & Energy and LinkGlobal International were pre-qualified for the technical bid stage.
The four new pre-qualified bidders joined the initial four earlier pre-qualified, which are Essar Infrastructure of India, Oando Plc, Refinee Petroplus and Transcorp Plc."
PHRC has two refineries at Alesa-Eleme near Port Harcourt in Rivers State - Port Harcourt 1 and Port Harcourt 2. Port Harcourt 1 is a topping and reforming refinery with a name-plate distillation capacity of 3,000,000 MTA (60,000 bpd). It began operations in 1965 but was largely destroyed by fire in 1989. It was then rebuilt using current technology.
Port Harcourt 2 is a complex, conversion refinery with a nameplate distillation capacity of 7,500,000 MTA (150,000 bpd). It came on stream in 1988 and was originally intended to serve as an export refinery. It has been subsequently dedicated to domestic market service given frequent interruptions in supply from the other three refineries in Nigeria. Port Harcourt 2 has considerable clean fuel capability, including lead-free gasoline.
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The bureau had said last year while extending the deadline for submission of expressions of interest that interested applicants were expected to be international and local oil and gas companies with a proven track record in the successful ownership, management and operation of crude oil refineries.
The statement said "To be pre-qualified, the prospective investors provided verifiable evidence of their ability to own, manage and operate a refinery of similar capacity. In this regard, the following information was requested from bidders: Evidence of successful investment(s) in and management of refineries plus verifiable evidence of strong investment capabi-lities; evidence of ample financial resources to impro-ve the refinery; thus enhancing its evidence of proven technical ability to manage and operate refineries.
Ownership structure including brief profile of significant shareholders and capabilities (technical and operational) in refinery operations indicating number of years in the industry, including international experience, list of plants owned, managed and operated by the company; and audited financial statements for the last five years were also reviewed, BPE said.
AI
