The Group Chief Executive Officer (GCEO) of the Nigeria National Petroleum Company (NNPC Ltd), Engineer Bayo Ojulari, has given reasons why the operations of the government-owned refineries were stopped.
Nigeria has four refineries two in Port Harcourt and one each in Warri and Kaduna. The refineries, have a combined installed capacity of 445,000 barrels per day (bpd). While the Port Harcourt refineries have a combined capacity of 210,000 barrels per day (bpd), the Kaduna and the Warri refineries have installed capacities of 110,000 and 125,000 bpd respectively.
Ojulari, who spoke at the sideline of the 9th Nigeria International Energy Summit tagged: “NIES 2026”, said the refineries were closed because they were not commercially viable based on their current condition.
According to him the fact that there were crude oil supplies did not help the cause of the refineries as they were operating between between 50 and 55 percent, which was not enough.
He said in the midst of the prevailing conditions of the refineries, the operating cost kept rising and their products were of low quality leading to great losses.
“The first thing that became clear is that we were running at a monumental loss to Nigeria. We were just wasting money. So the first decision that I had to make was to stop the rot and first of all calibrate quickly, rebate to see what we can do.
“We are pumping cargo every month into the refineries. Utilisation of those cargoes was maybe like 55 and 50 percent. That cargo is valued a lot.
“We are 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,” Ojulari said.
He added that NNPC was planning to release parts of equity to global investors with long-term investments to secure sustainability.
“We are not selling Nigeria. But, we are open to selling some equity as much as required to secure sustainability. Our solution is to put a sustainable structure in place one, where the refinery can finance itself and run like a proper business.”
