The Nigeria Employers' Consultative Association (NECA) has urged the Federal Government to privatize or concession the nation's refineries, citing endless turnaround maintenance (TAM) cycles that have consumed over $25 billion with minimal results. This call follows the Memorandum of Understanding (MoU) between the Nigerian National Petroleum Company Limited (NNPCL) and Chinese firms for the restart, completion, and expansion of the Port Harcourt and Warri refineries.
NECA's Stance on Refinery Rehabilitation
Adewale-Smatt Oyerinde, Director-General and Chief Executive of NECA, stated yesterday that while functional refineries are desperately needed, the body cannot ignore the decade-long pattern of billion-dollar rehabilitation contracts that have yielded zero sustained refining output. He emphasized that it would be unpatriotic to endorse another opaque deal while questions about past spending remain unanswered.
Oyerinde highlighted that between 2010 and 2023, Nigeria expended over N11 trillion (approximately $25 billion) on refinery rehabilitation projects, maintenance, and turnaround programs, yet the state-owned refineries remain significantly unreliable and non-functional. He lamented that the gamble of over $1.5 billion on the Port Harcourt refinery in March 2021 is still fresh in Nigerians' minds, as despite claims of 90 percent readiness by 2026, the facility has not produced sufficient barrels of refined product on a sustainable basis.
According to Oyerinde, since the 1990s, the Port Harcourt Refinery has undergone multiple rehabilitation cycles—2000-2010, 2012-2015, and 2016-2021—each involving billions of dollars, yet the facilities continued to deteriorate. He urged NNPCL to provide Nigerians with sufficient information on the status of past spending and audits conducted on the refineries. He also questioned how the MoU would guarantee Nigerian man-hours, procurement, and technology transfer beyond press statements.
Oyerinde called for the urgent fixing of the governance model before fixing the pipes. He noted that Nigeria cannot industrialize on imported fuel and cannot develop by burning approximately $25 billion on refineries that do not work.
Civil Society Supports MoU
Meanwhile, a civil society organization, Nigeria Citizens Watch for Good Governance, has expressed support for the MoU between NNPCL and two Chinese firms—Sanjiang Chemical Company Limited and Xinganchen (Fuzhou) Industrial Park Operation and Management Co. Ltd—for the rehabilitation, restart, and expansion of the Port Harcourt and Warri refineries.
The group, in a statement issued by its chairman, Collins Eshiofeh, said that if faithfully executed, the deal will fundamentally restructure Nigeria's downstream petroleum sector, strengthen energy security, create mass employment, and stop the recurrent hemorrhage of scarce foreign exchange on fuel importation. The CSO described the pact as arguably the most consequential refinery intervention since Nigeria's return to democratic governance.
