Business & Economy

NNPCL’s Refinery Crisis: Billions Wasted, Experts Blast Mismanagement

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Industry experts and operators have raised concerns about the Nigerian National Petroleum Company Limited (NNPCL), particularly regarding transparency, efficiency, and the management of Nigeria’s refineries.

This comes after it was revealed that the Warri Refining and Petrochemical Company (WRPC) has remained shut since January 25, 2025, due to safety issues with its Crude Distillation Unit (CDU) Main Heater. An April 2025 report from the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) revealed that the refinery, which cost $897.6 million in maintenance, failed to produce Premium Motor Spirit (petrol) and was shut down just a month after former NNPC Group CEO, Mele Kyari, declared it operational.

Experts and industry players have expressed disappointment over the situation, while further findings show that the Port Harcourt Refining Company, which resumed operations in November 2024, is operating below 40% of its capacity.

The WRPC, located in Warri, had been non-functional for decades due to technical problems before NNPC began its revitalization in December 2024. At the time, it was announced that the refinery had resumed operations at 60% capacity, with plans to ramp up production of key products like Kerosene, Automotive Gas Oil (diesel), and Naphtha.

However, the refinery was shut down less than a month later due to safety concerns related to its CDU Main Heater. Meanwhile, Port Harcourt Refinery, which has a capacity of 60,000 barrels per day, has been operating at just 37.87% capacity, producing significantly less than its expected output.

The NNPC spokesperson has downplayed the shutdown, claiming the maintenance is part of a planned routine maintenance program aimed at ensuring optimal operations. However, operators and analysts remain skeptical, accusing NNPC of mismanagement and lack of accountability.

Chinedu Ukadike, the National Publicity Secretary of the Independent Petroleum Marketers Association of Nigeria, criticized the ongoing issues, calling for urgent reforms within the country’s ailing refinery sector. He also urged the President to declare a state of emergency and conduct a full review of the facilities.

Bala Zaka, a petroleum expert, echoed these concerns, stating that Nigerians have not seen the benefits of refinery operations in the form of reduced fuel prices. He argued that unless there is a substantial reduction in the cost of petroleum products, the claims about operational refineries are meaningless.

Dan Kunle, an oil and gas expert, went further, describing the rehabilitation of the Port Harcourt and Warri refineries as a “scandal,” claiming that the previous NNPC management failed to deliver on promises despite significant investments. He also expressed support for the appointment of Bayo Ojulari as the new NNPC Group CEO, suggesting that the previous management’s incompetence had hindered progress.

The situation has drawn attention to the ongoing challenges within Nigeria’s oil and gas sector, particularly with state-owned refineries, which continue to struggle despite billions of dollars invested in their revitalization.

Mike Ojo

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