Azikel Refinery, a full hydro-scheming plant will commence operations next year. Its founder, Dr. Eruani Azibapu Godbless, spoke with journalists on the project. Jonathan Eze brings the excerpts:
Tell us about your businesses and how do you manage activities within the group without compromising the survival of one for the other?
Azikel group consists of four major companies namely, Azikel petroleum which is involved in refining activities in the downstream sector; Azikel Power which is licenced for 500 megawatts on-grid power generation for the country; Azikel Air which is the aviation wing; and Azikel sand, which is involved in dredging activities. Our emphasis on Azikel Dredging is because it was the company that sprouted out all these other companies. But I want to make it very clear to all that, Azikel Group is a business that has grown beyond sand selling. Azikel Group, of course with the subsidiary of Azikel Petroleum in Petroleum sector is all about providing, powering the wings of industries in Nigeria. Azikel Petroleum stands to address Nigeria’s oil import needs by ensuring that the country refines what it produces.
Azikel Petroleum and Aliko Dangote are the fore runners in building refineries in Nigeria today. Our own idea is to reverse that story where Nigeria should be a country that is self-sufficient in refined products. The Azikel Petroleum provides self-sufficiency of refined products back in Nigeria, particularly in our area of operation which is in the Niger Delta and Bayelsa State. Then we begin to now think of exporting refined products because that is the way it should be. So, that itself is a huge business creating several tiers of business levels as well as several tiers of wealth creation. The construction will be over and we will go into the production and you know that we will depend on petroleum for a long time.
In terms of power needs, Azikel Power is licenced to generate 500 megawatts. The country needs several of such licences for power to be able to meet the demand of power in Nigeria, because we are moving from 4,000 to 60,000. What drives us is being able to provide power for Nigerians. Azikel Power provides electricity for Nigerians so that we can endear other infrastructural and business sustainability and development, because without electricity, we cannot effectively compete with the rest of the world. That also keeps us in the business. We are not just very concerned about making money; we will make money by adding value to the society.
Can you give an insight into how you became an entrepreneur despite being trained as a medical doctor?
I started life as a young child in my village. A remote village in Ogbia Local Government, the village is called Emadike. As a young child, I grew up seeing what my father does and I learnt a whole lot of trades from my father both in leadership and in business. I actually saw the art of business from my father. My mother was also a trader. She traded well and part of the process of that trade was what was used to sending me to secondary school.
After growing up in the village, went to the University of Port Harcourt in quest to become a medical doctor. I went to medical school and did exceedingly well. I had my own challenges and landed all quest of survival in medical school, because it came a time when my father had some business challenges and he couldn’t cope with a lot of the financial obligations and I had to try to take the leads on. This led me into all sorts of legal jobs in the university.
I became a doctor, enjoyed my medical practice. I decided to do special training in surgery at the University of Port-Harcourt Teaching hospital. I later moved on to the United States, specialising in a family medicine. I became a member of the American Academic Pharmacy & Physicians, after which I returned to Nigeria and had a wholesome interesting medical practice. I also worked in Nigerian Agip Oil Company as well as with some revered politicians. Thereafter, I became a commissioner. After working in the ministry of health in my early medical days, I became an adviser to the then governor who became president of Nigeria after I left the oil company. I was a special adviser on HIV/AIDS in the country. So, when he left to become a president, and a new governor came on, the governor was quite very close to me and he wanted to make advances in the medical sector and I took that challenge and tried to change the nature of medical practices back in Bayelsa and in Nigeria as well. And after going through all of these careers from civil service to oil and gas and then to the political space, I decided to become an entrepreneur.
Considering the transition from civil service to entrepreneurship, how did you manage to scale through the hurdles?
One of the hurdles I had to overcome while doing the dredging business was to convince people that we have the best sand despite controlling some market share. After our technical partners left, we had to go out of our comfort zone to hire machines to remain in operations. We saw an opportunity, identified and dissected it by looking at our systems vis-à-vis the future of Bayelsa, the Niger-Delta and the demand for sand, and we knew that we can play this when we maximise our machinery and available human resources. Having study that there is a huge potential here, we decided to invest in our first dredging machine. When we got that machine, we realised that we can outplay everybody, because everybody was playing small. We knew the demand of sand in Yenagoa.
Yenagoa in its dire infrastructural time, consumes more than a million cubits of sand, a month. That is a billion naira. And as at the time we started, we could produce about 1 million cubits of sand in 40 days. So, if I can make a billion naira in 40 days. That was a lot of money back then in 2005 or 2006. Not many people knew that.
Azikel dredging business has impacted a whole lot on the Bayelsa economy and that of the Niger/Delta. We have provided employment to the people in the region and in Bayelsa. Azikel dredging is one of the biggest tax paying companies in Bayelsa State and in the Niger delta. We have re-engineered the economy of Bayelsa State. We have also taken on huge infrastructural development critical to Bayelsa State and the region.
There have been challenges with refining crude oil in the country. What do you hope to do differently to change the narrative?
The question is; why has the rest of the world succeeded and Nigerians failed? If the rest of the world succeeded, I do not see any reason why we should fail. The refined products we use in Nigeria today come all the way from far India, Brazil, and Europe. We sell our crude oil to Brazil, India and china, they refine it and sell it back to us. There is no reason why we should fail. Over time, we have noticed that government businesses are really not done with the best private sector driven rules and that is why the refineries operate in a civil service pattern.
Azikel Refinery which is a full hydro-scheming plant is going to be the best hydro scheming plant that will commence operation in Nigeria. We are operating this refinery in line with best international best practices. And the scenario here is this, we are selling the refined products to Nigerians. The market is available here. We are buying the crude oil from the same Nigerian market. There is not going to be freight charge on the crude oil, so the economy of freight is already going to come to us. Why it would not fail is because we haven’t failed in all other business operations. Because we deployed best business practices, any business that does not follow best practices would fail even if it is in the United States or in Nigeria.
When should Nigerians expect your refinery to commence operations?
We are on schedule. Rents and other challenges surface. But in terms of commissioning and operation, we are looking at latter part or 2018 or early 2019. But in the worst scenario, we are coming on stream in 2019. But this is a very dynamic process. It takes a whole lot. It is draining all the staff and they are also ready for this ride and we are very excited seeing the progress that we have achieved so far.
Considering the type of refinery your firm desires to construct, is there a model you want to replicate?
There are two types of refinery construction. We have the conventional type and the modular type. The conventional type means that you dig the foundation, you weld everything, and you build everything on spot. Modular refinery on the other hand is one in which the entire processes unit is built elsewhere, tested, configured, operated and transported to site. When you consider the one that is more economical, advantageous and quick to operate, it is the modular refinery. Because what happens is, a high-level expert engineering is deployed into building these systems, configuring it, testing it and building it elsewhere with high level professionalism where resources is very much available. So, that system is called the ISBL. It is called the Inside Battery Limit. Now, in the conventional refinery, you have the ISBL built on spot where it takes you to about 4-5 years, where then you are going to be flying all the experts from all over the world for servicing and work. You end up creating needless labour that you might not have enough resources to meet future challenges.
So when you go to Azikel Refinery today, you’ll see the Outside Battery Limit (OSBL) in active construction, the roads, the gantries, the admin blocks, the maintenance building and the firefighting areas. That is the OSBL. Then the ISBL which is 65per cent coming up as of today is what you call the process unit. Process units consist of; the CDU (the Crude Distillation Unit), the Naphtha Hydro Teeter, the Catalytic Reformer, all of these, the Naphtha Splitter, the Isomerisation Unit, all of these constitutes the ISBL. So, this is being built outside to be transported in situ for installation.
The advantage for this is for economic reason and quick operations. You can easily build the ISBL (the process unit) outside of this country which is a lot much easier way yielding to success to deploy. Cost wise, there is almost not much of a difference.