Former President Olusegun Obasanjo has reiterated his long-standing position that Nigeria’s state-owned refineries may never function effectively, as the Nigerian National Petroleum Company Limited (NNPC) continues efforts to secure technical partners for the Port Harcourt, Warri, and Kaduna facilities.
Obasanjo made the remarks during a television interview aired on Sony Irabor Live on Saturday night, where he stressed that public-private partnership (PPP) remains the most viable model for managing such assets.
“One of the lessons that I learnt is that PPP works. Look at the Nigeria Liquefied Natural Gas, where the private sector holds 51 per cent and the government 49 per cent. That project has not been destroyed,” he said.
He criticised government handling of key national assets, including railways, the national shipping company, and the NNPC, insisting he had always doubted the viability of government-run refineries.
“The NNPC has refineries, and I said to people that it will never work,” he added.
Obasanjo also recounted his unsuccessful attempts to bring in Shell to manage the refineries during his tenure. According to him, the company declined both equity participation and operational control.
Explaining Shell’s position, he said the firm cited limited profitability in downstream operations, small refinery capacity compared to global standards, poor maintenance culture, and widespread corruption as key concerns.
“They told me they make most of their profits from upstream operations. The refineries are too small, not well-maintained, and there is too much corruption around them,” he said.
The former president further recalled a deal with Aliko Dangote, who offered $750 million to acquire 51 per cent of two refineries an offer he described as a “miracle” at the time.
However, the agreement was later reversed by his successor, Umaru Musa Yar’Adua, following pressure from NNPC officials.
“I told him NNPC could not run the refineries, but he said he acted under pressure,” Obasanjo said, adding that the assets would have been sold as scrap for less than $200 million if left unsold.
He noted that the current NNPC Group Chief Executive Officer, Bayo Ojulari, is among the few officials to have been candid about the state of the refineries.
According to Obasanjo, Nigeria has spent about $16 billion on refinery rehabilitation just $4 billion short of the estimated cost incurred by Dangote to build Africa’s largest refinery.
In November 2025, NNPC set a June 2026 target to conclude the selection of technical partners for the refineries.
Ojulari had earlier disclosed that despite the rehabilitation and reopening of the Port Harcourt and Warri refineries in 2024, they were later shut again after operating below international standards, making their products uncompetitive compared to the privately owned Dangote refinery.
Dangote has also maintained that he built his refinery after the Yar’Adua administration reversed the sale of the NNPC refineries, and he shares the view that the government-owned facilities may not function effectively.
Elijah Adeyemi
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