NNPCL tackles Obasanjo over alleged $2bn refineries repair fund

Former President Olusegun Obasanjo has revealed new details about Nigeria’s refineries’ woes, recounting failed efforts to privatise the plants and the subsequent alleged financial losses of about $2bn by the facilities under government management.

Obasanjo disclosed this on Thursday as the Nigerian National Petroleum Company Limited beckoned the ex-President to visit the recently revamped refineries for a tour.

The former President said his successor, Umaru Musa Yar’Adua, rejected a $750m offer from Aliko Dangote, Chairman of Dangote Group, to manage the Port Harcourt and Kaduna refineries in 2007.

Obasanjo spoke in an interview with Channels Television, on Thursday, highlighting the challenges faced with Port Harcourt, Warri, and Kaduna refineries during his presidency.

The former president said the NNPCL was aware of its limitations in managing the nation’s refineries but still informed Yar’Adua that the oil company could operate the refineries — leading to his successor rejecting Dangote’s offer.

He said companies approached by the government to acquire equity in the refinery, expressed concerns about corruption impeding its operations.

“When I was President, I wanted to do something about the three refineries we have: Port Harcourt, Warri, and Kaduna. Aliko got a team together after I asked Shell to come and run it for us. And Shell said they wouldn’t. I said, please come and take equity, they said no. I said okay, don’t take equity, come and run it, they said no.

“Later on, I called them. I called the boss of Shell to come and tell me what the problem was and he gave me four or five reasons. He said, first of all, they make a major profit from upstream, not from downstream. He said they run downstream just to keep their head above water.

“Two, our refineries were too small: 60,000 barrels, 100,000 barrels, and I think 120,000 barrels. He said that at that time, the average refinery was going for 250,000 barrels.

“Three, he said our refineries were not well maintained. Fourth, he said that there was too much corruption around the activities of our refinery and they would not want to get involved in that.”

Obasanjo shared that after Shell’s refusal, Africa’s richest man, Aliko Dangote, assembled a team and paid $750m to operate the refineries through a public-private partnership.

“Aliko got a team together and they paid $750m to take part in PPP (Public–Private Partnership) in running the refineries. My successor refunded their money, and I went to my successor; I told him what transpired; he said NNPC said they wanted the refinery and they could run it, and I said, but you know they cannot run it,” Obasanjo stated.

The former President expressed confidence in Dangote’s ability to manage his privately owned refinery effectively, contrasting it with the government’s inefficiency.

Obasanjo also expressed frustration over the mismanagement of the refineries, adding that despite the amount spent on them since 2007 no results have been made.

“I was told not too long ago that since that time, more than $2bn have been squandered on the refinery and they still will not work.

“If a company like Shell tells me what they told me, I will believe them. If anybody tells you now that it is working, why are they now with Aliko? And Aliko will make his refinery work; not only make it work, he will make it deliver.”

On December 31, 2024, the Group Chief Executive Officer of the NNPCL, Mele Kyari, said the Warri Refining & Petrochemical Company in Delta State had commenced operations.

On November 26, the NNPC said the Port Harcourt refinery had officially commenced crude oil processing.

Obasanjo concluded with a Yoruba proverb, comparing inflated claims about the refineries’ performance to a farmer who planted 100 heaps of yam but falsely claimed to have planted 200.

“They say after he has harvested 100 heaps of yam, he will also have 100 heaps of lies. You know what that means,” he said.

NNPCL invites Obasanjo

However, responding to the claim, the NNPCL spokesperson, Femi Soneye, extended an invitation to Obasanjo for a sightseeing tour of the Port Harcourt refinery to verify its operational status.

Soneye in a statement, said, “We extend an open invitation to President Obasanjo for a tour of the rehabilitated refineries to witness firsthand the progress made under the new NNPC Limited.”

Giving further details, Soneye explained that the NNPCL did not only carry out turnaround maintenance on the plant but embarked on a complete overhaul of the refinery to meet world-class standards.

He said, “As part of this transformation, NNPC Limited has gone beyond oil and gas to become an integrated energy company. One of our notable achievements is the complete rehabilitation of the Port Harcourt Refining Company and Warri Refinery.

“This process was not merely the Turnaround Maintenance of the past but a full-scale overhaul designed to meet world-class standards. Similarly, we are currently conducting the same comprehensive rehabilitation of the old Port Harcourt Refinery and Kaduna Refinery.”

He added that NNPCL has evolved from being a government corporation to a private entity with limited liability.

He said owing to the transition, NNPCL has also moved on from being a loss-making organization to a profit-driven international energy firm.

“Under this new model, NNPC Limited has expanded beyond oil and gas to become an integrated energy company. Our focus is not only on harnessing traditional resources but also on developing cleaner, cheaper, and sustainable energy solutions to meet Nigeria’s growing demands,” the statement concluded.