The Nigerian National Petroleum Corporation on Tuesday officially signed the contract with Tecnimont SPA for the $1.5bn rehabilitation programme of the Port Harcourt Refining Company.

Parties in the agreement also announced the commencement of the project following the signing of the contract at the headquarters of the corporation in Abuja.

At the virtual contract signing event, the Group Managing Director, NNPC, Mele Kyari, explained that the agreement was basically between PHRC and Tecnimont SPA.

He said the contract was for the provision of engineering, procurement, construction, installation and commissioning services for the refinery rehabilitation project.

The Managing Director, PHRC, Ahmed Dikko, signed for the refinery, while a representative of Tecnimont SpA, Davide Pellizola, signed for the Italian engineering firm.

Last month, the Federal Executive Council approved $1.5bn for the revamp of PHRC, a development that generated diverse reactions.

The government targets to complete the first phase of the rehabilitation in 18 months and hopes that this will take the refinery to a production of 90 per cent of its nameplate capacity.

“The second phase is to be completed in 24 months and all the final stage will be completed in 44 months and consultations are approved,” the Minister of State for Petroleum Resources, Timipre Sylva, had stated in March.

According to him, funding for the project would come from NNPC internally generated revenue, Afreximbank, and budgetary provisions.

At the contract signing, Kyari said the oil firm’s target was that the refinery would begin production in 18 months.

The GMD had also stated that the publication of the audited financial statements of the NNPC facilitated the financing for the revamp of the Port Harcourt refinery.

Kyari stated that the publication of the corporation’s audited financial statements had significantly improved investors’ confidence in the corporation.

He said it was instrumental to the speedy facilitation of the financing agreement for the rehabilitation of the Port Harcourt refinery by the African Export Import Bank.

The NNPC boss also stated that the corporation had put in place a transparent process for the rehabilitation of the Warri and Kaduna refineries.

He said the EPCIC contracts of the two refineries would be awarded in June 2021.

Kyari said the PHRC rehabilitation exercise was different from a routine Turn-Around Maintenance as it would entail a total retrofitting of the plant with major part and equipment replaced with new ones.

This came as the Managing Director, PHRC, Ahmed Dikko, explained that phases 1 and 2 of the project would get the refinery ready to receive hydrocarbon.

He said phase 3 would focus on the start-up of the refinery for operation, stressing that the entire work shall be delivered in 44 months from today.

The Vice President, Sub-Saharan Africa Region, Tecnimont SpA, Davide Pelizzola, pledged the readiness of his company to work with the NNPC to comply with the terms and obligations of the contract.