NNPC Boosts Investment in Dormant Refineries to N2.92tn Amid Ongoing Revival Plans
The Nigerian National Petroleum Company Limited (NNPC) increased its investment in the country’s three non-operational refineries to N2.92 trillion in 2024, according to its audited financial statements. This marks a significant jump from N1.72 trillion in 2023, representing a 69.5% increase, despite the facilities remaining largely inactive after years of rehabilitation delays and shifting government timelines.
The Port Harcourt, Kaduna, and Warri refineries each recorded substantial investment increases. Port Harcourt Refining Company’s allocation rose from N674.32 billion in 2023 to N1.143 trillion in 2024, Kaduna Refining and Petrochemical Company saw a rise from N641.71 billion to N1.088 trillion, and Warri Refining and Petrochemical Company increased from N402.96 billion to N683.33 billion. Each facility’s funding rose by nearly 70%, reflecting NNPC’s commitment to reviving the ageing infrastructure.
Despite these investments, none of the government-owned refineries have returned to commercial operations. Nigeria has struggled for decades to restore its refineries, with billions of dollars spent on turnaround maintenance yielding minimal results. The combined nameplate capacity of the three refineries is around 445,000 barrels per day, yet commercial production has not been achieved in over ten years.
NNPC’s Group CEO, Bayo Ojulari, acknowledged the challenge of rehabilitating the facilities, citing decades of neglect and operational inefficiencies. “It’s like trying to get an old car running after years of being parked without maintenance,” he said. Ojulari also highlighted that NNPC is undergoing technical and commercial reviews to determine the most viable path forward, including potential partnerships with professional refining companies.
The company is exploring a broader strategy to transform the refineries into sustainable, revenue-generating assets that can meet domestic fuel demand. Ojulari emphasized that the refineries will eventually resume operations, despite doubts from industry figures such as Dangote Group President Aliko Dangote, who noted that previous investments of up to $18 billion have failed to restore production. NNPC continues to leverage its equity in Dangote Petroleum Refinery and other diversification efforts to ensure fuel supply during the transition.
source: punch