Why NNPC refineries will never work again – Obasanjo

Former President Olusegun Obasanjo has emphatically said that Nigeria’s government-owned refineries will never function properly, slamming the current management approach as a recipe for failure.

Speaking candidly on Sony Irabor Live aired on News Central, Obasanjo reiterated his stance, arguing that government control and mismanagement have condemned the refineries to eternal dysfunction.

His bold claim challenges the federal government’s projection that the Port Harcourt refinery will resume operations by December 2023 after its rehabilitation by Maire Tecnimont SpA.

Obasanjo, who had a front-row seat to Nigeria’s failure to maintain its refineries during his tenure, explained that the root of the problem lies in Nigeria’s persistent reliance on inefficient state-run enterprises, where corruption, lack of accountability, and political interference are rampant.

Drawing from his experience, Obasanjo pointed to the massive success of Nigeria Liquefied Natural Gas (NLNG), where the private sector holds a controlling stake. “NLNG works because the private sector has control. The model works, but it’s one the government refuses to adopt for its refineries,” he stated.

He also dismissed any hope that a government-controlled NNPC could ever compete with modern, efficient refineries, citing poor maintenance and widespread corruption that have plagued Nigeria’s facilities for years.

Recalling a failed attempt to get Shell to run Nigeria’s refineries, Obasanjo said he personally reached out to the oil giant, offering them a 10% equity stake to manage the facilities. Shell, however, rejected his proposals. According to Obasanjo, a senior Shell official candidly explained why: Nigeria’s refineries were simply too small, ill-maintained, and entangled in too much corruption to be managed profitably.

“The refineries are too small compared to global standards. Shell wanted nothing to do with them,” Obasanjo explained, adding that the refineries were underperforming because they had been poorly maintained by “quacks and amateurs.”

His criticism of the refineries’ situation is far from a technical debate—it is a damning indictment of a government that continues to ignore the hard truths about its public enterprises.

Obasanjo’s condemnation comes in the wake of President Tinubu’s rosy projections about the refineries’ rehabilitation. In December 2023, Tinubu had expressed optimism that the Port Harcourt refinery would come back online, but Obasanjo’s warning was clear: without private sector involvement and proper governance, the refineries will remain a pipe dream.