By JKNewsMedia
NIGERIA’s STATE oil company may sell its refineries as complications continue to undermine years of costly rehabilitation efforts.
The Nigerian National Petroleum Company (NNPC) Limited is currently re-evaluating its strategy for revamping its state-owned refineries amid persistent operational setbacks, according to its Group Chief Executive Officer, Bayo Ojulari.
Speaking on the national oil firm, Ojulari disclosed that a full review of the company’s refinery rehabilitation strategy is underway and may be concluded by the end of the year.
Ojulari in Vienna, said that while significant investments and advanced technologies have been deployed over the years, many of those interventions have fallen short of expectations.
On the sidelines of the 9th OPEC International Seminar, he noted that the technical complexity of restarting old and long-abandoned facilities had emerged as a critical stumbling block.
“Some of those technologies have not worked as we expected so far,” Ojulari admitted.
“When you’re refining a very old refinery that has been abandoned for some time, what we’re finding is that it’s becoming a little bit more complicated.”
Although the Port Harcourt refinery briefly commenced operations in late November 2024, it shut down again in May for maintenance. Meanwhile, the refineries in Warri and Kaduna remain in rehabilitation phases.
The setbacks have prompted a broader review that may alter the trajectory of state involvement in refining operations altogether.
Ojulari acknowledged that divestment is one of several options under consideration. “Sale is not out of the question,” he said. “All the options are on the table, to be frank, but that decision will be based on the outcome of the reviews we’re doing now.”
The suggestion of an outright sale reflected remarks made recently by industrialist Aliko Dangote, who publicly questioned whether the refineries would ever return to full functionality.
Dangote’s skepticism came just days before Ojulari’s admission, reinforcing public doubts over the viability of continued government-led refurbishments.
Former president Olusegun Obasanjo also criticised the over $2 billion spent on turnaround maintenance over the years, lamenting the absence of tangible results.
Beyond the refinery review, Ojulari offered insights into the broader challenges within Nigeria’s upstream oil sector.
He revealed that the operating cost of crude oil production currently ranges between $20 and $30 per barrel, driven in part by hefty investments in pipeline security.
He noted that 100 percent pipeline availability had been achieved, but at a significant financial cost.
“We believe with time, with stability, that cost will start going down,” Ojulari said. “But for now it’s somewhere between $25 and $30 a barrel.”
He added that the NNPC plans to increase national crude oil output to 1.9 million barrels per day by year-end, signalling a cautious optimism amid structural and operational reforms.
