Oil and Gas opportunity: Start Your Own Private Petroleum Refinery

Part 1

A refinery is a production facility comprised of a group of chemical engineering unit processes and unit operations refining certain materials or converting raw material into finished products. Petroleum oil refinery, which converts crude oil into high-octane motor spirit (gasoline/petrol), diesel oil, liquefied petroleum gases (LPG), kerosene, heating fuel oils, hexane, lubricating oils, bitumen and petroleum coke. Petroleum Refinery is a capital intensive business but at the same time it is highly lucrative in the Oil and Gas sector. Once you are able to secure your license to lift crude oil, then you would be on your way to making mega cash. There are countries, like Nigeria, where private firms and individuals are issued licenses to operate their own legal private refineries in the Oil and Gas industry.  If you live in any country where it is legal to own a private refinery, then you should consider opening your own private petroleum refinery. As a matter of fact, this type of business is reserved for big – time investors because of the money and politics involved in securing a license to run a private petroleum refinery.

Though, not everyone is cut out for the high risk, volatile reward stakes of an oil and gas start-up, but for those willing to take the bet, now is a good time to try.

Low interest rates, the promise of a friendlier regulatory environment and billion-dollar private equity investors on the prowl among others factors are lining up to build a boom in oil and gas start-ups.

 It is an opportunistic time if you have the smarts to do it – if you understand what goes into it and around it.

When the industry is booming with high oil prices, people probably leap before looking more often.  And prices are low, people are a lot more scrutinizing. 

Start-up Capital

To get started, the upstream projects require a significant investment from the beginning of this Oil and gas business. Once you start building capital, it becomes easier to obtain more from different sources especially in environments where oil and gas business flourishes well. For example in Nigeria, oil and gas is a way of life in cities like Lagos, Port-Harcourt and Kaduna.

Developing an A-Team

In the oil and gas business, developing the right team into place is important especially in the eyes of private equity lenders. It might not be a large team to be successful. Your company will start with its people and outside your company, solid industry contacts also count for your business to record success.

The people you put together for these projects are more valuable than the money you can get because they are the determinant of your company`s success.

Having workers who have experience, the smarts and who understand technology, at the same time workers who understand the kind of drilling and operations that have to be built out around all of this – that’s number one.

Mentors / Consultants 

I suppose it is also important to find a mentor / Consultant – somebody that does not work for you or with you that you can call upon and get good, sound advice. Many new entrepreneurial in the oil and gas Sector are very successful just by having the right mentors.

As such, you need to know someone who understands the rules and regulations that dictate how things are being done in oil and gas Industries.

Oil and gas sector is a highly regulated industry; you need to have somebody on your team that knows how to navigate all of the rules.  This is where a private equity firm with a great track record can be helpful as well.