Nigeria’s Oil Minister Urges NNPC to Invest in Private Refineries Over State-Owned Operations
Nigeria’s Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, has called on the Nigerian National Petroleum Company Limited (NNPC) to shift its focus towards acquiring stakes in private refineries rather than attempting to revive and run government-owned ones. His remarks came during the inaugural summit of the Crude Oil Refineries Owners Association of Nigeria, held in Lagos on Tuesday.
Addressing the gathering, Lokpobiri highlighted the Federal Government’s evolving strategy to reposition the NNPC, noting that the state-run oil company should consider equity investments in new and established private refineries across the country. He pointed to the recent example of the Dangote Refinery, where NNPC capped its stake at 7.2 per cent, a significant reduction from the initially planned 20 per cent.
“For future refinery projects, we will encourage NNPC Ltd to prioritise taking equity in private enterprises rather than managing refineries directly,” Lokpobiri explained, adding that the move is designed to enhance efficiency in the nation’s refining capacity.
The minister’s remarks come at a time of growing frustration over the government’s attempts to rehabilitate its state-owned refineries. Despite spending approximately $4 billion on reviving the long-dormant Port Harcourt, Warri, and Kaduna refineries, none have yet resumed operations. The Port Harcourt refinery alone has seen multiple assurances from the NNPC that it would begin production, though the deadline has repeatedly been pushed back.
In an effort to address the ongoing challenges, Lokpobirirevealed that the NNPC recently advertised for private sector involvement in the management of its refineries. This, he suggested, reflects the government’s broader intention to introduce a new operational model for its four state-owned refineries.
“We will encourage NNPC Ltd to run the four governmental refineries on a different model. And you will recall that an advertisement was recently placed by the NNPC Ltd to give out refineries to private sectors to run optimally,” Lokpobiri said, emphasising the need for a more pragmatic approach in the face of persistent inefficiencies.
The move to reduce direct government control over refining is seen as a key step towards boosting domestic fuel production, with the hope that private sector management will deliver more reliable results in an industry plagued by setbacks and mismanagement.
As Nigeria grapples with meeting its energy needs, the minister’s comments signal a potential turning point in the country’s refining strategy, placing private refineries at the centre of efforts to ensure the sector’s future success.
