Former President Olusegun Obasanjo recently criticized Nigeria’s oil company for its lack of capacity to efficiently operate the nation’s refineries. He pointed out that repeated failed attempts to privatize the facilities have resulted in alleged financial losses of approximately $2 billion under government control.
During his tenure, Obasanjo made efforts to address challenges at Nigeria’s refineries—Port Harcourt, Warri, and Kaduna. He approached Shell to manage the refineries, offering equity and operational roles, but the company declined. Subsequently, Africa’s richest man, Aliko Dangote, assembled a team and paid $750 million to operate the refineries through a public-private partnership. However, Obasanjo mentioned that his successor refunded their money and insisted that the NNPC could run the refineries, despite doubts about their capability.
In response, the NNPC spokesperson, Femi Soneye, invited Obasanjo to visit the Port Harcourt refinery for a firsthand tour to verify its operational status. Soneye emphasized that the NNPC not only performed turnaround maintenance on the refinery but also undertook a complete overhaul to bring it up to world-class standards. The NNPC has transitioned from a government corporation to a private limited liability entity, focusing on becoming a profit-driven international energy firm.
Despite Obasanjo’s confidence in Dangote’s ability to manage his privately owned refinery effectively, he expressed frustration over the mismanagement of the government-owned refineries. The Nigerian government has reportedly spent billions of dollars over decades on the repair and maintenance of its three refineries, with specific allocations for each facility.
Obasanjo’s criticism highlights the ongoing challenges in Nigeria’s oil industry and the need for efficient management and investment in refinery infrastructure. The response from the NNPC indicates efforts to improve and modernize operations, transitioning towards a more profitable and sustainable energy sector. As the debate continues, it remains crucial for stakeholders to address these issues and work towards a more efficient and productive oil industry in Nigeria.
