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Former President Olusegun Obasanjo has shed light on Nigeria’s ongoing refinery challenges, revealing how attempts to privatize and efficiently manage the refineries were thwarted, leading to significant financial losses.
In an exclusive interview with Channels TV on Thursday, Obasanjo recounted efforts during his tenure to rehabilitate the Port Harcourt, Warri, and Kaduna refineries by seeking external partnerships. However, these attempts faced stiff resistance.
“I approached Shell to manage the refineries for us,” Obasanjo recalled. “They refused. I even suggested taking equity, but they declined. Later, I asked them to simply oversee operations without equity involvement, and they still said no.”
He detailed a conversation with Shell’s leadership, where the company provided reasons for their refusal.
“They explained that their primary profit comes from upstream operations, not downstream. The refineries were also too small—60,000, 100,000, and 120,000 barrels—compared to the global standard of 250,000 barrels at the time. Additionally, the refineries were poorly maintained, and corruption was rampant around their operations,” Obasanjo shared.
Following Shell’s rejection, Africa’s wealthiest man, Aliko Dangote, stepped in with a proposal. Dangote and his team offered $750 million through a public-private partnership (PPP) to manage the refineries.
“Aliko formed a team and paid $750 million to participate in the PPP. However, my successor refunded the money,” Obasanjo revealed. “I explained to him what had transpired, but he insisted that NNPC could run the refineries. I told him they couldn’t, and time has proven me right.”
The former president criticized the inefficiency of government-run refineries, contrasting it with Dangote’s private refinery.
“Since then, over $2 billion has been wasted on the refineries, yet they remain nonfunctional. If Shell says something isn’t feasible, I believe them. Meanwhile, Aliko will not only make his refinery work but also ensure it delivers.”
Concluding his remarks with a Yoruba proverb, Obasanjo likened the government’s inflated claims about the refineries to planting 100 heaps of yam but boasting about planting 200.
“They say after harvesting 100 heaps of yam, the remaining 100 heaps are lies. You understand what that means,” he remarked.
