Energy expert wants FG to sell its four refineries

Energy expert Dan Kunjle has called on the federal government to sell the four refineries owned by the Nigerian National Petroleum Company Limited (NNPCL).

Mr Kunle made this statement in an open letter to President Bola Tinubu on Sunday. The letter is titled, "NNPC’s Four Diseased Fingers: The Refineries That Must Be Privatised."

In the letter, he referred to the refineries, Port Harcourt Refineries I and II, Warri Refinery, and Kaduna Refinery, as "four diseased fingers" that have wasted public funds for years without providing reliable refining capacity.

He argued that ongoing spending on these refineries takes away limited resources from important areas like healthcare, education, infrastructure, security, and electricity.

Mr Kunle pointed to the privatisation of the Eleme Petrochemicals complex during former President Olusegun Obasanjo's time. He said this shows that selling government assets can boost efficiency, attract investment, and create jobs.

He urged President Bola Tinubu to tell NNPC Limited to hand over the refineries to the National Council on Privatisation and the Bureau of Public Enterprises. He wants a clear and open privatisation process that should finish within one year.

The expert said the sale should include full details of bidders, asset valuations, ownership structures, and investment commitments. He wants both Nigerian and foreign investors, including reported Chinese interests, to compete fairly.

Mr Kunle also warned against unclear asset transfer deals that look like technical partnerships or memoranda of understanding. He said such agreements could lead to legal issues and hurt investor confidence.

He stated that the government should either privatise, concession, or close the refineries if it makes sense economically. He believes these changes would allow NNPC to focus on upstream operations and stop years of waste.

Mr Kunle’s comments come as the Economic and Financial Crimes Commission (EFCC) investigates the alleged misuse of funds meant for refinery repairs.

"The time for endless rehabilitation has passed. The time for decisive reform has arrived. Mr President, this is a legacy decision. Privatise them transparently. Concession them transparently where appropriate. Liquidate those that can no longer be economically justified. Above all, let the law, openness and the national interest guide every decision. The Chinese are welcome to compete. Nigerian investors are welcome to compete," the letter partly read.

Last week, PREMIUM TIMES reported that the EFCC recovered over N38.66 billion and several properties during its investigation into funds meant for the repair and maintenance of Nigeria’s refineries.

Investigators described this as one of the biggest probes into spending on refinery repairs.

Nigeria has four state-owned refineries that can process a total of 445,000 barrels per day. The two refineries in Port Harcourt can handle 210,000 bpd, the Kaduna Refining and Petrochemical Company can handle 110,000 bpd, and the Warri Refining and Petrochemical Company can handle 125,000 bpd.

Despite many attempts to repair them and billions spent from public funds, these refineries have mostly been out of operation for many years.

PREMIUM TIMES also reported that the EFCC has charged the last managing directors of the Port Harcourt and Warri refineries, Ahmed Adamu Dikko and Jimoh Olasunkanmi Yisawu, with money laundering over the alleged misuse of funds for refinery repairs.

As efforts to revive the refineries continue, the federal government and NNPC are looking for strategic investors and technical partners to boost domestic refining capacity.

In May, NNPC signed a memorandum of understanding with two Chinese firms to help complete, operate, and possibly expand the Port Harcourt and Warri refineries.