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| Nigeria’s refineries could power future growth |
The Director-General of MAN, Segun Ajayi-Kadiri, says state refineries drain public funds and must be sold. He warns these plants add no real value to our economy.
Nigeria has spent over $27 billion trying to fix its three refineries since 2013. They still fail to meet demand . In contrast, the Dangote refinery runs at more than half capacity after a $19 billion build .
Official probes are now checking $2.9 billion spent on refinery rehab since last year . Earlier, $2.4 billion went to poor fixes at Port Harcourt and Warri plants . Despite this, output stays below 70% of capacity.
The Port Harcourt plant can refine 60,000 barrels per day. It ran at 70% soon after its 2024 relaunch . The Warri refinery holds 125,000 barrels per day, but it peaked at 60% after rehab . Kaduna, the third state refinery, never reached full use either.
Our local refineries fail to meet demand. That forces us to import 15.4 trillion naira ($9.63 billion) of petrol in 2024 . This heavy import cost drains foreign reserves and raises pump prices at home.
Pro-sale voices say private owners will invest and run plants more efficiently. They expect jobs to grow in the process. Critics warn that a sale must protect workers’ rights and ensure maintenance budgets cover staff needs.
India sold its Bharat Refineries in the 2000s to private firms. Those plants now run above 90% capacity. They also paved way for new tech and cleaner fuel mixes. South Korea privatised its state refineries in the 1990s. Today they supply refined products at lower cost and support export growth.
Some industry players worry that full sale might give too much control to a single firm. They call for mixed ownership. They want 30% local share, 50% to major investors, and the rest on the stock exchange .
Others stress that privatization alone cannot solve all ills. They want clear regulations, stable power supply, and transparent licensing. They insist on local content laws to benefit host communities.
Both plants sit near towns with high poverty rates. Locals have long waited for reliable power and road upgrades. A sale deal should include community development funds. That could fund schools, clinics, and road repairs in Ubeji, Ifie-Kporo, Aja-Etan, and Alesa-Eleme.
A sale plan needs strong oversight. A clear tender process can curb corruption. It must set penalties for failure to meet output or pollution targets. Regulators should audit plant safety and environmental standards at least twice a year.
Privatized refineries could run at 80–90% capacity within two years of sale. That drop in imports could save $3–4 billion yearly. More local supply may lower petrol prices by 10–15%, easing living costs.
Investors bring modern tech and global supply links. They can tap crude from local fields and abroad. They can add petrochemical units to boost plastic and chemical output.
The FG must clear $11 trillion naira debt on these plants before sale. It should also end fuel subsidies to let market prices guide operations. A clean slate will attract credible bidders.
Stakeholders should hold public forums. They must discuss deal terms openly. That builds trust and curbs fake news. A live-stream debate could air on YouTube and TV. That would let citizens ask questions directly.
Selling Warri and Port Harcourt refineries is not a quick fix. It must pair with sound policy and community care. But this move can end years of money loss. It can bring reliable fuel, new jobs, and growth.