Nigeria’s refinery troubles have once again come to light, as former President Olusegun Obasanjo revealed details of failed privatization efforts and the significant losses suffered under government management.
In an interview with Channels TV on Thursday, Obasanjo discussed the challenges faced during his administration with the Port Harcourt, Warri, and Kaduna refineries. He recounted his attempts to involve external expertise to rehabilitate and manage the facilities, only to face repeated rejections.
“I approached Shell to manage the refineries, but they declined,” Obasanjo said. “I offered them equity participation, but they refused. Even when I asked them to run the refineries without taking equity, they still said no.”
Obasanjo explained that Shell’s leadership cited several reasons for their refusal: “They said their major profits come from upstream, not downstream, and that our refineries were too small—60,000 barrels, 100,000 barrels, and 120,000 barrels—compared to the global average of 250,000 barrels. They also mentioned poor maintenance and pervasive corruption surrounding refinery operations as key deterrents.”
Following Shell’s rejection, Obasanjo revealed that Aliko Dangote, Africa’s richest man, stepped forward with a team and offered $750 million to manage the refineries through a public-private partnership.
“Aliko and his team paid $750 million to partner in running the refineries. However, my successor refunded their money. When I questioned this, he said the NNPC claimed they could handle it themselves. I told him they couldn’t, and unfortunately, the results have proven me right,” Obasanjo noted.
The former president contrasted the government’s inefficiency with Dangote’s capability, expressing confidence in the billionaire’s ability to effectively manage his private refinery.
“I’ve heard that over $2 billion has been wasted on these refineries since then, and they still don’t work. If Shell told me what they did about our refineries, I believe them. If anyone says they’re operational now, why is Aliko still involved? Aliko will not only make his refinery work but also ensure it delivers,” Obasanjo asserted.
Concluding his remarks, Obasanjo used a Yoruba proverb to illustrate his skepticism about claims of progress with the refineries.
“They say, after harvesting 100 heaps of yam, he will also add 100 heaps of lies. You know what that means,” he said, highlighting the ongoing challenges with Nigeria’s refineries.
