President of the Dangote Group, Alhaji Aliko Dangote, has expressed doubt on the viability of Nigeria’s state-owned refineries despite over $18 billion reportedly spent by the federal government on their rehabilitation.
Speaking during a visit by members of Global CEO Africa to the Dangote Petroleum Refinery in Lagos, Dangote said the refineries located in Port Harcourt, Warri, and Kaduna may never function efficiently again due to outdated infrastructure and mismanagement.
He revealed that his company had once acquired the refineries during the administration of former President Olusegun Obasanjo but was forced to return them following a change in government.
“We bought the refineries in January 2007. They were doing about 22 percent of Premium Motor Spirit (PMS) production. But after the government changed, we were asked to return them,” he said.
According to Dangote, officials at the time persuaded the late President Umaru Musa Yar’Adua that the Nigerian National Petroleum Company (NNPC) could manage the facilities.
“Today, after spending about $18 billion on turnaround maintenance, the refineries still aren’t working. And I doubt if they ever will. Trying to modernise them is like upgrading a 40-year-old car, changing the engine doesn’t make the body compatible with modern technology,” he explained.
Dangote also disclosed that the idea to construct his 650,000-barrel-per-day refinery emerged after the Yar’Adua administration declined to sell him the refineries.
The privately owned facility is now expected to reduce Nigeria’s dependence on imported fuel significantly.
Former President Obasanjo has also previously shared similar views, lamenting the mismanagement and failed rehabilitation efforts of the nation’s refineries.
“I told my successor that NNPC cannot manage those refineries,” Obasanjo said. “Some investors, including Aliko Dangote, paid $750 million to take over the refineries. But the deal was reversed by Yar’Adua. Since then, billions of dollars have been squandered, and the refineries are still not working.”
Obasanjo argued that vested interests within NNPC undermined reform efforts, driven by opportunities for corruption.
“They knew they couldn’t fix it, but they wanted to continue benefiting from the rot. In any civilised country, those responsible should be in jail,” he stated.
He added that international oil companies such as Shell had advised that the refineries were beyond recovery. “If someone says the refineries are working, why are they relying on Aliko Dangote’s refinery now?” he asked.
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