Evaluating the Economic Viability of Modular Refineries in Nigeria

Abstract This paper aims to comprehensively analyse Nigeria's refining sector, exploring the potential for newly established modular refineries to work alongside traditional counterparts. By closely examining the current state of the refining industry and identifying areas for enhancement, the analysis intends to clarify how Nigeria can utilize modular refineries to revitalize its petroleum sector and promote sustainable economic development. The paper offers an overview of the challenges and opportunities associated with introducing modular refineries in Nigeria to enhance the country's energy capabilities and refine domestic resources. It identifies hurdles like infrastructure inadequacy, government policies, pollution, limited production capacity, and financial constraints hindering seamless integration. Additionally, it explores the economic benefits of modular refineries through a comprehensive analysis, utilizing techniques such as perpetuity evaluation. The study employs Python for numerical computations and Excel for graphical representation, utilizing secondary data for interpolation. Results suggest a significant economic potential ranging from 11.24 billion dollars to 13.57 billion dollars in perpetuity, indicating the viability of modular refineries. Forecasted costs, factoring in currency exchange rates, provide insights into financial considerations. Furthermore, it underscores the benefits of expanding refinery infrastructure to meet rising demand, highlighting the importance of collaborative efforts among stakeholders for successful implementation. Strategic planning and cooperation are emphasized to harness the full potential of modular refineries in Nigeria's energy landscape.