Oil marketers, industry stakeholders back sale of Nigeria’s refineries

DDM NEWS

Oil Refinery

Oil marketers and industry stakeholders have thrown their weight behind the proposed sale of Nigeria’s refineries, citing the need for transparency, inclusiveness, and accountability in the process.

The Nigerian National Petroleum Company Limited (NNPCL) had hinted at selling off the nation’s ageing refineries due to the complexity and high costs associated with revamping them.

The Port Harcourt, Warri, and Kaduna refineries, with a combined capacity of 445,000 barrels per day, have been underperforming despite trillions of naira spent on rehabilitation and maintenance.

The refineries have become a massive drain on public resources, with little to no output, leading to calls for their sale or privatization.

Proponents of the sale argue that privatization will bring in fresh investments, expertise, and management practices, potentially increasing efficiency and productivity.

Oil marketers and industry stakeholders are demanding transparency in the sale process to ensure accountability and fairness.

They also want the process to be inclusive, allowing all interested parties to participate and ensuring that the sale benefits the nation as a whole.

Stakeholders are also calling for accountability in the sale process, with some experts suggesting that top officials in previous NNPC administrations should be investigated for alleged economic sabotage

The sale of the refineries could lead to increased competition in the downstream sector, potentially resulting in lower fuel prices for consumers.

Privatization could bring in more efficient management practices, reducing the financial burden on the government and increasing productivity.

Some experts warn that without addressing systemic corruption, the sale of the refineries may not yield the desired results.

A robust regulatory framework is necessary to ensure that the sale process is transparent, inclusive, and accountability.

The call follows recent remarks by NNPCL Group CEO, Bayo Ojulari, who admitted in a Bloomberg interview that despite heavy rehabilitation spending, the Port Harcourt, Warri, and Kaduna refineries—with a combined capacity of 445,000 barrels per day—remain obsolete and are not delivering desired results.

Ojulari confirmed that all options, including full or partial sale, are now on the table as the company reassesses its strategy, with a decision expected by year-end.

Critics say the refineries have become a massive drain on public resources. Despite trillions of naira in turnaround maintenance and rehabilitation efforts over the years, the facilities remain non-functional, prompting many to label them as “financial black holes.”

$1.4 billion approved for Port Harcourt refinery in 2021

Despite these investments, no significant output has been recorded.