The Nigerian National Petroleum Company Limited (NNPC Ltd), has explained why they halted operations at the country’s state-owned refineries.
Speaking during a fireside chat at the ongoing Nigeria International Energy Summit (NIES 2026) on Wednesday, Group Chief Executive Officer of the NNPC Ltd, Bayo Ojulari, explained that the state-owned refineries were shut down because they were not commercially viable in their current condition.
“The first thing that became clear is that we were running at a monumental loss to Nigeria. We were just wasting money.
“I can say that confidently now. So the first decision that I had to make was to stop the rot by ensuring that we stop and first of all calibrate quickly, rebates to see what we can do,” Mr Ojulari said.
The Warri Refinery, which was reopened in December 2024, shut down in January last year on account of safety issues. In May 2025, NNPC Ltd announced an outage at the Port Harcourt Refinery, preparatory to scheduled maintenance.
On Wednesday, Mr Ojulari said despite crude oil supplies, the refineries struggled to operate efficiently, with utilisation rates stuck between 50 and 55 per cent.
He added that the operating and contractor costs kept rising, but the refined products yielded were often of lower value than the input crude, resulting in significant losses.
“We are pumping cargo every month into the refineries. Utilisation of those cargoes was maybe like 55 and 50 per cent. That cargo is valued a lot.
“We’re spending a lot of money in the operations, a lot of money in the contractors but if you then look at the net, we’re just leaking away a lot of value and there was no clarity on what’s the plan to turn that loss into positive,” he said.
Nigeria has four state-run refineries, including two in Port Harcourt, which together form the Port Harcourt Refining Company, with a combined installed capacity of 210,000 barrels per day (bpd).
The Kaduna Refining and Petrochemical Company Limited has an installed capacity of 110,000 bpd, while the Warri Refining and Petrochemical Company Limited has an installed capacity of 125,000 bpd.
All the four refineries have a combined installed capacity of 445,000 bpd.
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Despite significant cash injections aimed at getting the plants to run optimally for years, the refineries continue to grapple with operational constraints, with site visits revealing most of the facilities are far from functioning at peak level.
Last October, the NNPC initiated a comprehensive technical and commercial review of the three refineries to ensure optimal performance and sustainability.
At the time, the company said it is seeking high-level technical partnerships with reputable operators to upgrade or repurpose the refineries as needed.
Speaking further, Mr Ojulari said it is no longer looking for contractors to run its refineries but experienced global operators with proven track records.
He added that the NNPC plans to relinquish part of its equity in the refineries to such partners to ensure they have “skin in the game” and a vested interest in long-term performance.
“We are not selling Nigeria,” he clarified. “But we are open to selling some equity as much as required to secure sustainability.
“Our solution is to put a sustainable structure in place one where the refinery can finance itself and run like a proper business,” he said.
