By Jane Okafor, Abuja
As the Nigerian National Petroleum Company Limited (NNPC) intensifies efforts to secure technical partners for the Port Harcourt, Warri, and Kaduna refineries, former President Olusegun Obasanjo has reiterated his long-held position that the facilities are unlikely to function effectively.
Speaking during a television interview aired Saturday night on Sony Irabor Live, Obasanjo pointed to structural and operational challenges that, in his view, have consistently undermined the refineries’ performance.
He said, “One of the lessons that I learnt is that PPP (public-private partnership) works. Look, one project that has not been destroyed by the government in Nigeria is the NLNG (Nigeria Liquefied Natural Gas), where the private sector has 51 per cent, and the Nigerian government has 49 per cent.
“See what we did with Nigerian railways. See what we did with the national shipping company. See what we are doing now, even with the NNPC. The NNPC has refineries, and I said to people that it will never work. And a man had the audacity to say, ‘Am I a chemical engineer?”
The former president recounted attempts made during his administration to привлечe private sector participation, including outreach to Shell to manage the refineries.
“Look, when I was there, I called Shell. I said, ‘Look, please, I beg you, come and take 10 per cent equity and run the refinery for us.’ They said no. I said, ‘Okay, if you don’t want to take equity, don’t take equity. Come and run the refineries. They said no,” he stated.
Obasanjo said he sought direct clarification from a senior Shell official on the company’s reluctance.
“So, I called him, and I said, ‘Tell me, be honest with me. Why don’t you want to handle this?’ He said first, they want to let me know that they make most of their profits on the upstream, not the downstream.
He said they run their downstream without making a loss, but they don’t make a lot of profit from it. It’s more of a service than a major profit-making. So that’s number one.
“Number two: he said our refineries are too small. This was when I was an elected President. He said our refineries are too small. One is 60,000 barrels, and another is 100,000 barrels. He said refineries at that time were in the range of 250,000 barrels to 300,000 barrels. Number three: he said our refineries are not well-maintained. We call quacks and amateurs to come and maintain our refineries. The refineries are not in good order. He said, ‘Number four, there’s too much corruption around our refineries, and they don’t want to be part of that,” Obasanjo explained.
He also recalled a later development involving the President of the Dangote Group, Alhaji Aliko Dangote, who offered to acquire a majority stake in two of the refineries.
“Until one day, Aliko (Dangote) came and offered $750m to take two of the refineries; that will be 51 per cent. I said, ‘Wow, God, you are really a God of miracles.’ I told Aliko to bring the money quickly. They brought the money, and they paid,” he said.
According to Obasanjo, the transaction was later reversed under his successor, the late President Umar Yar’Adua, following pressure from within the NNPC.
“When I left office, NNPC went to my successor and convinced him. So I got up. I went to Umar. I said, ‘Look, Umar, maybe you don’t know; this is why we did what we did.’ He said, ‘Well, NNPC came to me.’ I said, ‘But you know that NNPC cannot run this thing. He said he knew. I asked, ‘Then why did you give in? He said because of pressure. And I said, ‘Look, when you sell these refineries, you will not get 200 million (dollars) for them, because you will sell them as scrap.’
“Only the present NNPC head has told the country the truth. But in the meantime, I was told that they have spent about $16bn, which is only $4bn short of what Aliko used to build Africa’s largest refinery,” Obasanjo said.
NNPC has set a target of June 2026 to conclude the selection of technical partners for the refineries, following earlier rehabilitation efforts that saw the Port Harcourt and Warri plants briefly reopen in 2024 before being shut again.
NNPC Group Chief Executive Officer, Bayo Ojulari, has acknowledged that the refineries are operating below international standards and are commercially uncompetitive, particularly when compared to the privately owned Dangote refinery.
Aliko Dangote has also maintained that his decision to build a refinery was influenced by the reversal of the earlier sale agreement, and he shares the view that the state-owned refineries may struggle to become operational again.
NNPC has yet to respond to Obasanjo’s latest remarks.
