Retailers say selling NNPC refineries will cut fiscal losses, boost efficiency, and stabilise downstream sector
The Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) has renewed calls on the Federal Government to privatise Nigeria’s four government-owned refineries, urging that the process be concluded no later than the first quarter of 2026.
The association said divesting the refineries operated by the Nigerian National Petroleum Company Limited (NNPC Ltd.) would end their long-standing financial drain on public resources, improve operational efficiency, attract private investment, and bring Nigeria’s refining sector in line with international standards.
In a statement issued by its National President, Billy Gillis-Harry, PETROAN said years of sustained public funding have failed to deliver meaningful results, making private sector-led management inevitable if Nigeria is to achieve energy security and stability in the downstream petroleum sector.
Gillis-Harry argued that a transparent and well-executed privatisation process would stimulate competition, ensure sustainable refinery operations, reduce reliance on imported petroleum products, conserve foreign exchange, and create jobs across the oil and gas value chain.
Refinery Reform Linked to Sector Growth
PETROAN also linked the reform of government-owned refineries to broader growth in the oil and gas industry, noting that increased domestic refining capacity would complement investments in upstream production and strengthen Nigeria’s overall energy outlook.
The association expressed confidence that the 2026 Budget, anchored on a crude oil production target of 1.84 million barrels per day and an oil price benchmark of $64–65 per barrel, provides a solid framework for implementing key sector reforms, including refinery privatisation.
According to PETROAN, decisive action on the refineries—alongside improved security for oil and gas infrastructure, effective host community engagement under the Petroleum Industry Act (PIA), and adequately funded regulators—would significantly boost investor confidence and sector performance.
The group added that privatising the refineries would free up government funds for priority areas such as security and infrastructure, while allowing the private sector to drive efficiency, innovation, and growth in refining and petrochemical development.
Renewed Debate Over Refinery Performance
Calls for privatisation have intensified following the shutdown of the 60,000-barrel-per-day Port Harcourt refinery in May, just six months after it was declared operational. The Warri refinery was also shut barely a month after it was reopened in December 2024.
The Manufacturers Association of Nigeria (MAN) has previously described the refineries as a drain on the economy, urging the Federal Government to sell them off.
Over the years, the government has spent billions of dollars on the rehabilitation of the Port Harcourt, Warri, and Kaduna refineries, which have remained largely non-functional. Records show that $1.4bn was approved for Port Harcourt’s rehabilitation in 2021, $897m for Warri, and $586m for Kaduna. An estimated ₦100bn was reportedly spent on refinery rehabilitation in 2021 alone, with additional hundreds of millions of dollars spent on turnaround maintenance between 2013 and 2017.
Despite these investments, the refineries remain unproductive.
NNPC Maintains Refineries Will Be Revived
However, the new Group Chief Executive Officer of NNPC Ltd., Bayo Ojulari, has rejected calls for the sale of the refineries, expressing confidence that the facilities can still be revived.
Ojulari disclosed that NNPC Ltd. is currently conducting a technical and commercial review of the refineries to determine whether to overhaul or repurpose them for improved efficiency and profitability.
According to him, the assessment is part of a broader strategy to reposition the refineries as sustainable, revenue-generating assets capable of meeting Nigeria’s fuel demand and aligning with global operational standards.
Meanwhile, the Nigeria Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) recently confirmed that NNPC imported significant volumes of petrol, a development marketers attributed to the prolonged dormancy of the government-owned refineries.
PETROAN insists that refinery privatisation remains central to stabilising the downstream sector and maximising the benefits of Nigeria’s oil and gas resources under the 2026 budget framework.
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