The Group Chief Executive Officer (GCEO) of the Nigerian National Petroleum Company Limited (NNPC Ltd), Engr. Bayo Ojulari, has advanced reasons why the nation’s four refineries were shutdown.
Engr. Ojulari gave the reasons on Wednesday in a Fireside Chat on Securing Nigeria’s Energy Future at the Nigeria International Energy Summit (NIES 2026), holding in Abuja.
The nation’s four refineries: Port Harcourt I &II, Warri, and Kaduna Refineries, with a combined installed capacity of 445,000 barrels per day (bpd) are currently non-functional despite gulping a whooping sum of $18 billion on rehabilitation.
The challenges were blamed on decades of underinvestment, poor maintenance, and vandalism.
Speaking, Ojulari said the refineries were stopped because it became very clear that the company was running at a monumental loss to Nigeria. “We were just wasting money.”
He said the company was spending a lot of money on the operations and contractors without getting values in return.
“So, the first decision that I had to make was to stop the rot by ensuring that we stop and first of all calibrate quickly, rebase to see what do we do. You wonder how we’re losing money.
“We’re pumping cargo, say cargo, every month into the refineries. Utilization of those cargoes was maybe like 55, 50%. That cargo is valuable.
“We’re spending a lot of money in the operations, a lot of money in the contractors. But if you then look at the net, we’re just leaking away a lot of value. And there was no clarity on what’s the plan to turn that loss into positive,’ he said.
To make the refineries work, the NNPC boss said “First, you need the financing because you need to finance the work, finance the activities and all of that. Two, you need a competent Engineering, Procurement and Construction (EPC) contractors to deliver world-class projects for you that are great. Three, you need a world-class operational capacity to run the refineries.”
He noted that the national oil company lacks operational capacity to run the state-owned refineries, adding that the company is looking for an entity that has the technical know-how in the management of refineries to come in and partner with the company to manage the refineries.
“And then we use that to develop, rebuild our own skills and support. And our mantra for the refinery and solution is about putting a sustainable solution in place for it to self-finance itself.
“For it to self-finance itself, for it to run like a business. We know that everywhere in the world, refinery margins are very high.
“So, there’s no way NNPC, the structure we have, we can run a profitable refinery. Forget it. We don’t have the capacity right now.
“We need to bring in additional capacity to complement what we have to run this refinery,” Ojulari said.
Throwing more light on the partnership, he said “the current NMPC strategy, as approved by our board, is to focus on getting partners that have track record of running the refinery. We are not looking for contractors. We’re not looking for O&M.
“We’re looking for an entity that run refineries. So coming, we’re looking forward for them to buy some of our shares. So, when you say sell, we will not say we are selling Nigeria, no, no, no, no, no.
“Just like we’ll probably look at options where you can sell down some of our equity.”
