•NNPC Ltd boss, Bashir Bayo Ojulari
Oil marketers and industry stakeholders have thrown their weight behind the proposed sale of Nigeria’s refineries under the management of the Nigerian National Petroleum Company Limited, calling for transparency, inclusiveness, and accountability in the process.
They noted that the sale or privatisation of the Port Harcourt, Warri, and Kaduna refineries, which have gulped trillions of naira in rehabilitation and maintenance with little or no result, will finally open the downstream sector to competition, ensure better pricing, and stop what many described as a financial black hole, reports The PUNCH.
Their reactions follow the recent revelation by the NNPC Group Chief Executive Officer, Bayo Ojulari, that rehabilitation works on the 445,000 barrels per day capacity refineries were not yielding the desired results due to how obsolete the facilities have become over the years.
Ojulari, in an interview with Bloomberg on the sidelines of the just concluded 9th OPEC international seminar in Vienna, Austria, admitted that the company is currently reassessing its refineries strategies and aims to finalise the review by year-end.
Ojulari further said NNPC remains uncertain whether the review will result in the sale of the refineries.
“What we are saying is that sale is not out of the question. All the options are on the table, to be frank, but that decision will be based on the outcome of the reviews we’re doing now,” he said in the interview.
The proposal, it was gathered, came on the same day the President of the Dangote Group, Aliko Dangote, suggested that the facilities might never be viable due to mismanagement and may not resume operations.
Industry experts say the plan, if executed transparently, could end years of waste and inefficiency.
The National President of the Petroleum Products Retail Outlets Owners Association of Nigeria, Billy Gillis-Harry, stated that the privatisation of the assets looks to be the only reasonable decision to make, considering its history of inefficiencies.
Gillis-Harris, speaking in an interview with our correspondent yesterday, however, questioned the motives behind the timing of this conversation, saying, “We need to be sure of what is driving this process and understand what is the influence behind it.”
He stated, “Well, if you go back a few months, PETROAN had done a very careful evaluation of the situation, and we had advised that privatisation of the refinery will be the best option. And we still maintain the same mindset.
So if NNPCL has come around, almost about six months or thereabout to get to the same conclusion. It only tells you that PETROAN does a very well detailed empirical analysis. We do wish them well.”
However, the association warned against turning the refineries’ sale into a political exercise devoid of clarity and stakeholder engagement.
He noted that the petroleum refining space should be opened up to encourage multiple players in the market, arguing that competition, not monopoly, will ultimately drive efficiency and ensure availability of petroleum products.
“Let the privatisation process, if they ever want to birth it, be done properly and it should all stakeholders. MEMAN, DAPPMAN, PETROAN, IPMAN and NUPENG. We should all be part of the process,” Gillis-Harry stated.
The PETROAN president also expressed disappointment with the current administration’s lack of follow-through on promised investigations into past refinery rehabilitation projects.
He referenced the now-elapsed 30-day ultimatum issued for revamping the Port-Harcourt refinery, questioning the silence surrounding its outcome.
He asserted, “The administration came in and this is the concern I have about politicising our public enterprises. They came in a zest to even say they want to review, research and probe to know what it was used for.
“We have not even heard any of the result of those investigations and then suddenly, selling the refineries becomes an option on the table. So you can clearly see that it is a situation that we really need to be careful about, because we are talking about our future.
“For us at PETROAN, we do know that government cannot run this business of refining and make it successful and that is why we have recommended that there should be a privatisation process which should include the grassroots stakeholders. It is very critical that even before discussion is on, let us see what is the result of the investigation.
“What is even the conclusions of the revamping that was given 30 days, for which PETROAN came out and said, let 30 days be days. That has even elapsed now and nothing seems to have even started. We don’t even know whether it is the jinx of NNPC or Nigerians oil and gas or some cabal. We need to be sure what we are doing in this country. We are only a group calling for accountability and we hope conversations will be held and answers will be given.”
Echoing similar sentiments, the National Publicity Secretary of the Independent Petroleum Marketers Association of Nigeria, Chinedu Ukadike, described the refineries as a burden on public finances.
According to him, the billions already sunk into turnaround maintenance efforts had yielded no tangible results. He noted that IPMAN had earlier called for the declaration of a state of emergency in the refining sector, describing it as long overdue.
Ukadike noted, “For me, NNPCL is a private investment owned by the federal government and it has been there for decades, supplying the need of Nigerians as at time. But in the last 15 years, it hasn’t been operational. The running cost is even higher than what it is earning in revenue or produce.
“So it is imperative that government looks at this and chart the best way forward, either to sell off the refinery or repair. But we have found out that, for a long time now, repairs is not imminent.
“And billions of naira have been sunked to do a turnaround maintenance. So whatever the government can do, to ensure that the property is being utilised. Like they did with Indorama, is acceptable for us. So that it can drive competition in the industry.”
When asked if the refineries should be sold off as scrap, Ukadike disagreed: “They should not be scrapped,” he said.
“We have advised before that the President should declare a state of emergency in the refining sector. That would yield positive results.”
He, however, noted that years of corruption and poor technical management had rendered the refineries dysfunctional despite billions of naira spent on rehabilitation.
“There’s nothing wrong in attempting repairs, but it’s clear now that corruption and inexperience have led to the waste of billions of naira on the three refineries, and yet, they’re still not working. At this point, the best option is to sell them,” he stated.
Quoting a local proverb, he concluded, “When your dog no longer recognises members of your family, the owners is advised to sell it for another owner, who might know how to treat it well.”
Also reacting to the development, energy economist and policy expert, Kelvin Emmanuel, raised alarm over the failure of anti-corruption agencies to act on what he described as a clear case of economic sabotage.
“It will be a travesty if the Attorney-General of the Federation and the EFCC Chairman allow the immediate past management and board of NNPC led by Mele Kyari to go scot-free without investigation and recommendation for prosecution,” he wrote in a post on X handle.
He argued that it would be irresponsible to proceed with the refinery sale without addressing issues of mismanagement and fiscal recklessness that plagued the assets under past leadership.
The federal government has consistently expended resources on the refineries, which went moribund many years ago. It was gathered that $1.4bn was approved for the rehabilitation of Port Harcourt refinery in 2021; $897m was earmarked for Warri, and $586m for Kaduna refineries.
N100bn was reportedly spent on refinery rehabilitation in 2021, with N8.33bn monthly expenditure. $396.33m was spent on Turnaround Maintenance between 2013 and 2017.
Despite all the financial allocations, the refineries remain unproductive at the moment.
Meanwhile, renowned petroleum economist, Professor Wumi Iledare, has cautioned against any hasty or sentiment-driven sale of Nigeria’s state-owned refineries, urging the federal government to adopt a strategic and transparent approach in line with the Petroleum Industry Act 2021.
Iledare stressed that although NNPC Limited, now operating as a commercial entity under the PIA, possesses the legal right to dispose of its assets, the decision to sell the country’s refineries should be guided by long-term national interest rather than immediate gains.
“The Port Harcourt, Warri, and Kaduna refineries have consistently underperformed,” he acknowledged.
“However, the core issue is not state ownership but inefficiency caused by poor governance and institutional weaknesses.”
