The Group Chief Executive Officer of the Nigerian National Petroleum Company (NNPC), Bayo Ojulari, has attributed the chronic underperformance and repeated failures of Nigeria’s state-owned refineries to a fundamental lack of effective operational capacity — a problem he says has left the facilities unable to sustain value over time.
Speaking at the 9th Nigerian International Energy Summit (NIES), Ojulari said that an internal assessment of the refineries revealed deep structural flaws that would have continued “value destruction for the next 30 years” if left unaddressed. He explained that this finding led the company to halt refinery operations and undertake a comprehensive review.
According to the NNPC boss, successfully running a refinery requires three critical components — adequate financing, a competent engineering, procurement and construction (EPC) contractor, and world-class operational capacity to manage the facility over the long term. “First, you need the financing… Two, you need a competent EPC contractor… Three, you need a world-class operational capacity to run the refineries,” he said, stressing that past efforts had focused heavily on financing and construction while neglecting the operational aspect.
Ojulari also described the previous model for managing Nigeria’s refineries as one in which various contractors and financiers “all taking money from the system without any skin in the game,” resulting in a setup “designed for taking, not to put anything in.” He said that without strong operational oversight and long-term management expertise, the facilities were never positioned to deliver sustainable performance.
Under the new approach, NNPC aims to prioritise operational excellence alongside financing and construction standards to ensure that future refinery activity creates value rather than destroys it.
