The Nigerian government has announced plans to privatise its four state-owned refineries in Port Harcourt, Warri, and Kaduna, as part of a broader effort to reform the country’s oil sector.
Special Adviser to President Bola Tinubu on Media and Public Communications, Sunday Dare, shared the news in a recent post on X (formerly Twitter), signalling a decisive step toward local refining self-sufficiency.
Dare stated that “full privatisation of Port Harcourt, Warri, Kaduna refining is in the works,” and highlighted the growing role of local oil production.
He further emphasised that with the involvement of private entities such as Dangote and modular refineries, Nigeria is set to significantly increase its local refining capacity.
This shift, according to Dare, will eventually eliminate the persistent issue of fuel queues across the country, a problem that has plagued Nigeria’s fuel distribution system for years.
The privatisation move follows several years of underperformance by the country’s refineries, which have been operating well below capacity.
The government hopes that bringing in private investors with the technical know-how and financial muscle will turn the refineries around and boost Nigeria’s oil production, reducing the nation’s reliance on imported refined products.
However, industry experts are urging caution and a closer adherence to existing laws, particularly the Petroleum Industry Act (PIA) 2021, which was designed to regulate the sector and ensure that reforms are carried out transparently and effectively.
Professor Wumi Iledare, a renowned Petroleum Economics expert, pointed out that the PIA should serve as the guiding framework for any decisions regarding the privatisation of national assets.
He underscored that the Nigerian National Petroleum Company Limited (NNPCL), not the federal government, holds the authority to determine the future of the refineries, as the company operates under the oversight of its Board of Directors.
According to Iledare, while the government has the prerogative to make recommendations, the final decision should rest with NNPCL’s Board, which represents the interests of both the Ministry of Finance Incorporated (MoFI) and the Ministry of Petroleum Resources (MoPI).
He stressed the importance of ensuring that potential buyers have the capacity to maintain and operate the refineries successfully, urging that the PIA 2021’s provisions should guide decision-making in the oil and gas sector.
Support for the privatisation plan has also come from the private sector, with Mr. Tunji Oyebanji, Managing Director of 11Plc, endorsing the move.
He argued that the privatisation would yield better results than the country has seen over the past decade, particularly if the refineries are sold to competent operators who understand the intricacies of refinery management.
While optimism surrounds the move, questions remain about the impact of the privatisation on Nigeria’s oil sector. For many Nigerians, the promise of a self-sufficient refining system is a long-awaited solution to years of fuel shortages and the high cost of imported refined petroleum products.
The government’s commitment to turning around the country’s refineries will be closely monitored, as it could be a key moment in Nigeria’s efforts to achieve sustainable energy independence.
The privatisation of Nigeria’s refineries marks a pivotal moment in the country’s energy reforms, with potential far-reaching implications for the nation’s economy and energy security.
