Oil marketers and industry stakeholders have expressed strong support for the proposed sale of Nigeria’s state-owned refineries, urging transparency, accountability, and full stakeholder engagement in the process. They believe that divesting from the long-dormant Port Harcourt, Warri, and Kaduna refineries could open up the downstream oil sector to competition, drive efficiency, and lead to a reduction in fuel prices.
Their reactions come in the wake of recent revelations by the Group Chief Executive Officer of the Nigerian National Petroleum Company Limited (NNPCL), Bayo Ojulari, who acknowledged that ongoing rehabilitation of the country’s refineries has not produced the desired results due to the outdated nature of the facilities.
Ojulari, speaking with Bloomberg at the 9th OPEC International Seminar in Vienna, Austria, confirmed that the company is currently reassessing its refinery strategy, with plans to complete the review before the end of the year.
“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,” Ojulari stated.
The development coincides with comments by Africa’s richest man and President of the Dangote Group, Aliko Dangote, who cast doubt on the viability of the ageing refineries, citing years of mismanagement and suggesting they may never return to full operations.
Marketers Call for Transparency and Inclusion
Commenting on the issue, the National President of the Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN), Billy Gillis-Harry, said the privatisation of the refineries is long overdue and appears to be the most viable option.
“PETROAN had done a very careful evaluation of the situation, and we advised that privatisation of the refineries would be the best option. We still maintain that position,” Gillis-Harry said in an interview with The PUNCH.
However, he cautioned against politicising the process. “Let the privatisation process, if they ever want to birth it, be done properly. It should include all stakeholders—MEMAN, DAPPMAN, PETROAN, IPMAN, and NUPENG. We should all be part of the process,” he added.
Gillis-Harry also criticised the federal government’s failure to provide updates on earlier promises to probe the massive sums spent on failed refinery rehabilitation projects. He cited the lapse of a 30-day ultimatum given for the revitalisation of the Port Harcourt refinery, noting that nothing had come of it.
“We haven’t heard the outcome of those investigations. Now suddenly, selling the refineries becomes an option. For us at PETROAN, government cannot successfully run refineries. That’s why we advocate for grassroots stakeholder participation in any privatisation process,” he asserted.
A Financial Burden on the Nation
Echoing similar views, the National Publicity Secretary of the Independent Petroleum Marketers Association of Nigeria (IPMAN), Chinedu Ukadike, described the refineries as a financial burden. He lamented that despite billions of naira spent on turnaround maintenance, the refineries have remained moribund for over 15 years.
“The running cost is even higher than the revenue or production output. It’s imperative that the government considers selling the refineries if repairs are no longer viable,” Ukadike stated.
He warned against scrapping the facilities entirely but stressed the need for a new direction. “We once advised the President to declare a state of emergency in the refining sector. Years of corruption and mismanagement have rendered the refineries useless,” he added.
Quoting a local proverb, Ukadike remarked, “When your dog no longer recognises members of your family, the owner is advised to sell it to someone who knows how to treat it well.”
Calls for Accountability and Due Process
Energy economist and policy expert, Kelvin Emmanuel, raised concerns over the lack of accountability for the billions lost to failed refinery projects. In a post on X (formerly Twitter), Emmanuel criticized the lack of investigations into past mismanagement.
“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 prosecution,” he said.
Emmanuel warned that selling off the refineries without addressing past corruption would only worsen the country’s economic challenges.
According to The PUNCH, the Federal Government has spent billions on refinery rehabilitation with little to show. In 2021 alone, $1.4 billion was approved for the Port Harcourt refinery, $897 million for Warri, and $586 million for Kaduna. Additionally, between 2013 and 2017, over $396 million was spent on Turnaround Maintenance, while N100 billion was allocated for repairs in 2021, including a monthly spend of N8.33 billion.
Expert Urges Strategic Approach
Meanwhile, renowned petroleum economist, Professor Wumi Iledare, advised the Federal Government to approach the sale of the refineries cautiously and strategically. While acknowledging the poor performance of the facilities, Iledare argued that the core issue lies not in state ownership but in weak governance and institutional inefficiencies.
“NNPCL, as a commercial entity under the Petroleum Industry Act (PIA), has the legal right to dispose of its assets. However, any decision to sell the refineries must be aligned with national interest and implemented in a transparent manner,” he said.
