Amid growing concerns over Nigeria’s struggling economy and the persistent failure of its state-owned refineries, the Manufacturers Association of Nigeria (MAN), crude oil marketers, and energy experts have renewed calls for the Federal Government to privatise the Port Harcourt, Warri, and Kaduna refineries.
Despite over $3 billion reportedly spent on their rehabilitation, the refineries remain idle, prompting stakeholders to describe them as a monumental drain on national resources.
The Federal Government has consistently pumped funds into the nation’s four refineries over the years, with little to show in return. In 2021 alone, $1.5 billion was approved for the rehabilitation of the Port Harcourt refinery, $897 million for Warri, and $586 million for Kaduna. Additionally, ₦100 billion was spent in the same year, with ₦8.33 billion allocated monthly to refinery maintenance. Between 2013 and 2017, a total of $396.33 million was spent on Turn Around Maintenance.
Yet, the plants remain largely non-operational. The recently re-opened Port Harcourt refinery, hailed as a milestone in December 2023, was again shut down in May for maintenance and has yet to resume operations. The Warri refinery also ceased functioning one month after its reopening.
“Refineries Are a National Liability” – MAN
Appearing on a live television programme on Wednesday, MAN Director-General, Segun Ajayi-Kadiri, described the refineries as “a pure drain on the Nigerian economy.” He stressed that state ownership had become synonymous with inefficiency, fraud, and wastage.
“We must speak the truth. These four refineries are unfair to Nigerians. They bleed public funds and deliver nothing. The government should encourage private sector investment by selling them off,” Ajayi-Kadiri said.
He argued that full privatisation would not only eliminate corruption and mismanagement but also foster competition—particularly with the Dangote Refinery, which recently began operations.
“If you go private, it becomes harder for anyone to steal or be unaccountable. These refineries should be competitors with Dangote’s plant, not dormant liabilities,” he added.
Echoing the position of MAN, the Publicity Secretary of the Crude Oil Refineries Association of Nigeria, Eche Idoko, said the refineries had become outdated and should be sold—if necessary—as scrap.
“Billions have been wasted on these refineries with zero productivity. Sell them. Use the proceeds to invest in modular and private refineries where the government can hold equity but not ownership,”
Idoko maintained that the current ownership model remains unsustainable due to rising overheads and poor management.
“The government keeps paying salaries and running costs for inactive facilities. This is unacceptable.”
MEMAN Recommends Professional Management
Also weighing in, the Executive Secretary of the Major Oil Marketers Association of Nigeria (MEMAN), Clement Isong, said the solution lies in handing over the refineries to professional refinery managers, either via outright sale or concession agreements.
“We need these refineries to work, not to remain in the news as financial blackholes. They must be run by professionals, not politicians. Political interference and bloated staffing are killing them,” Isong said.
He added that competition in the downstream oil sector is essential, especially with the Dangote Refinery now in operation.
“Nobody can bully Dangote because he runs a private business. That’s the advantage of private ownership. Refineries should not be managed as social projects.”
Energy Experts, Economists Support Sale
Ibrahim Tajudeen, Director of Research and Strategy at Chapel Hill Denham, proposed a Public-Private Partnership (PPP) model to revive the refineries.
“The MAN is right. Either through complete sale or PPP, we need the efficiency and discipline of the private sector. The government can maintain minority stakes but should hand operational control to professionals,” he said.
Similarly, former Chief Economist at Zenith Bank, Marcel Okeke, said the proposed sale of the refineries is “long overdue.”
“They have not produced in years. All efforts to refurbish them have failed. They should be sold as-is. Private investors know how to turn them around. Government has no business in business,” Okeke argued.
NNPC Refineries: Once Open, Now Shut Again
The push for privatisation intensified after the Port Harcourt refinery, which was briefly declared operational in December 2023, was shut down again in May 2024 for maintenance that has now entered its second month. The Warri refinery, reopened in December last year, also ceased operations barely a month after.
The Nigerian National Petroleum Company Limited (NNPC), which manages the refineries, is yet to provide a comprehensive explanation for the repeated shutdowns.
Public frustration over the lingering state of the refineries is on the rise, with many Nigerians questioning how the country, one of the world’s top crude oil producers, still relies heavily on imported refined products.
The Federal Government has yet to issue a formal response to the renewed calls for privatisation, but pressure is mounting ahead of the 2025 fiscal year.
