*”Praises Dangote Refinery As “Critical Stabiliser” That Gave Nigeria “Breathing Space”
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The Group Chief Executive Officer of NNPC Limited, Engr. Bayo Ojulari, has said that the corporation lacks the capacity to run a refinery, stressing that the reoperationalisation of the Port Harcourt Refinery and Petrochemical Company was a huge waste of resources.
Ojulari made the disclosure on Wednesday while speaking at the ongoing 2026 Nigerian International Energy Summit.
He said effective refinery operations require adequate financing, competent Engineering, Procurement and Construction (EPC) contractors, as well as strong operational and maintenance capacity—conditions he said NNPC presently does not meet.
The Port Harcourt Refinery, rehabilitated at the cost of about $1.5 billion under the leadership of former NNPC GCEO, Mele Kyari, was reopened in November 2024 after nearly three years of rehabilitation. However, it was shut down again in May 2025 following sustained financial losses.
Ojulari explained that a detailed review of the refinery’s operations revealed that it was running at a significant loss.
“The first thing that became clear was that we were running at a monumental loss to Nigeria. We were just wasting money. I can say that confidently now,” he said.
“So the first decision I had to make was to stop the rot by shutting it down and then quickly recalibrate to see what could be done.”
He questioned how the facility continued to record losses despite regular crude supply.
“We were pumping cargo into the refinery every month, but utilisation was around 50 to 55 per cent. Those cargoes have value, and we were losing that value. We were spending a lot of money on operations and contractors.
“But when you look at the net outcome, we were just leaking value, and there was no clarity on how to turn those losses into positive returns,” he added.
Ojulari said NNPC is now seeking reliable partners with proven experience in refinery management to operate the country’s refineries.
“To make a refinery work, you need three things,” he said. “First, financing to support operations. Second, a competent EPC contractor. Third, world-class operational capacity to run the refinery.”
According to him, NNPC’s current strategy, as approved by its board, is to partner with experienced refinery operators rather than contractors.
“We are not looking for contractors. We are not looking for O&M service providers. We are looking for an entity that actually runs refineries,” he said.
He added that the successful operation of the Dangote Refinery had reduced the urgency to rush decisions on reviving government-owned refineries.
“There was a lot of pressure about continuity, but we were not under that pressure. And thank God for Dangote Refinery. Thank God. Whether you love Dangote or hate him, thank God.
“Thank God he is a Nigerian and not someone from another continent. Despite everything, that gave us breathing space because we now have a refinery that is working,” he said.
The Group Chief Executive Officer of the Nigerian National Petroleum Company Limited praised the Dangote Petroleum Refinery as a critical stabiliser of Nigeria’s energy system, amid the state-owned oil company’s challenges in operating its government-owned refineries and meeting domestic fuel demand.
Ojulari, who spoke during a fireside chat titled “Securing Nigeria’s Energy Future” at the Nigeria International Energy Summit 2026 on Wednesday in Abuja, said the existence of a functional local refinery provided NNPC with much-needed “breathing space” amid intense pressure to maintain fuel supply continuity.
He said the Dangote Refinery has been a major relief for Nigeria’s fuel supply, urging Nigerians to appreciate its impact regardless of personal views about its owner, noting that the plant’s operations had drawn applause from participants at the event.
“Thank God for Dangote Refinery. Thank God. Whether you love Dangote, you hate him, say whatever you want to say, Nigerians should thank God for Dangote,” Ojulari said, drawing applause from the audience.
According to him, the coming on stream of the 650,000 barrels-per-day refinery marked a major relief for Nigeria at a time when legacy state-owned refineries were still struggling to deliver at scale.
Ojulari stressed that beyond capacity, the refinery’s local ownership was equally significant for national energy security.
“Thank God he’s a Nigerian. He’s not someone from another continent or another planet. Despite everything, that gave us an opportunity because we have a refinery that is working,” he said.
While acknowledging that the refinery does not yet meet Nigeria’s full domestic fuel demand, the NNPC boss said its operations have significantly reduced vulnerability in the supply chain.
“Yes, it may not meet our full needs, but it gives us a breathing space. And luckily, we are shareholders in that refinery as well,” he noted.
Ojulari’s remarks signal a notable shift from years of tension between NNPC and the Dangote Group, which had previously clashed over issues ranging from crude supply terms and regulatory approvals to pricing and market-dominance concerns.
Under past leadership, the relationship was often characterised by public disagreements and mutual suspicion, with Dangote accusing state institutions of frustrating the refinery project, while regulators insisted on enforcing market and quality standards.
However, Ojulari said the current NNPC leadership has adopted a more pragmatic approach anchored on collaboration rather than confrontation.
“So we said, what’s the hurry? We have a refinery that is working. It’s not owned by NNPC, but it’s a Nigerian refinery, built in Nigeria, working in Nigeria,” he said.
He disclosed that NNPC has since engaged directly with Dangote to develop a framework for cooperation aligned with the Petroleum Industry Act.
“Our strategy is to collaborate with the Dangote Refinery and maximise the value delivered to Nigerians. That was our first strategy. We had a meeting with Alhaji Dangote, explained our institutional responsibilities, and we agreed on the pathway towards deeper collaboration while maintaining our role as NNPC,” Ojulari explained.
On oil production, Ojulari expressed optimism that Nigeria could achieve a production level of 1.8 million barrels per day in 2026. However, he described the Federal Government’s 2025 budget benchmark of 2.06 million barrels per day as overambitious, noting that average production last year was about 1.7 million barrels per day.
“For this year, we have a target of two million barrels per day, but the budget is based on about 1.8 million barrels per day. So we are not overcommitting,” he explained.
“One of the financial problems Nigeria faced last year was overprojection. We overprojected production and revenue, and by mid-year, oil prices were lower while production was below projections.
“Yet spending plans had already been made based on those assumptions. That has far-reaching consequences,” he said.
Ojulari stressed that credible and realistic production planning must be taken seriously to avoid future fiscal crises.
Meanwhile, stakeholders have continued to express mixed reactions over the 2026 budgetary allocation to the non-functional Ajaokuta Steel Company Limited (ASCL).
The ASCL, established in 1979, is a critical asset conceived to drive Nigeria’s modernisation.
ASCL was allocated N6.69 billion in the 2026 Appropriation Bill, representing a 4.90 per cent decrease from the 2025 allocation of N7.03 billion.
The allocation covers personnel costs of N6.04 billion, overhead of N233.6 million and N410.8 million for capital projects.
While some stakeholders acknowledged the government’s efforts to resuscitate the company, particularly in line with President Bola Tinubu’s economic diversification agenda, others expressed concern that the allocation could be mismanaged.
Mr Philip Jakpor, the Executive Director of Renevyln Development Initiative (RDI), raised concerns over reports on the steel company’s state, in spite of continued budgetary allocations for its revival.
Jakpor alleged that past administrations had repeatedly used ASCL to access funds without improving its status.
“It seems it has become a cash cow for some individuals in every administration; they pump billions of naira into its rehabilitation, and yet the mill does not work a single day.
“So, we are not surprised that this administration has again budgeted N6.69 billion for it in the 2026 Appropriation,” he said.
Dr Abdullahi Jabi, Chairman of the North Central Zone of the Campaign for Democracy, Human Rights Advocacy, and Civil Society of Nigeria, underscored the importance of discipline for effective budget implementation.
According to him, budget ‘somersaults’ undermine Nigeria’s industrialisation efforts, which he described as crucial for the development of the steel sector.
He said critical sectors such as the steel sector should be prioritised, with professionals and specialised manpower engaged to boost the economy amid current challenges.
“Critical areas should have an impact on the people beyond the signing of MoUs without anything to show for it.
“We need a paradigm shift as promised in the electioneering campaign,” he said.
Dr Emmanuel Shuiabu, a former ASCL resident, said he lived in Ajaokuta from 1982 to 2002 and recalled that the steel company was once the largest employer in Nigeria, providing more than 10,000 direct jobs.
Shuiabu said the company’s Thermal Power Plant and Turbo Blower Station once generated power at full capacity, and the community experienced no outages between 1987 and 1989.
He expressed concern over the current state of the plant, saying that beyond political will, concrete political action, particularly engagement with the original builders of the plant, was required to drive meaningful change.
“The challenge with government is the lip service they pay to some things that are meant to drive industrialisation in Africa, because ASCL is the largest steel plant in Africa,” he said.
According to him, professionals who have worked at ASCL should be engaged in efforts to resuscitate it because of their experience, even if it requires appointing personnel who retired from the plant.
Shuiabu, also a finance expert, said that in spite of stakeholders’ concerns over rising budgets for the plant, not all allocations were usually released during implementation.
The Minister of Steel Development, Prince Shuaibu Audu, said in his New Year message that, in spite of the non-release of 2025 budget funds, the ministry maintained reform momentum through prudent use of the 2024 appropriation.
A Lokoja-based public analyst, who asked to remain anonymous, said only maintenance work was ongoing at the plant and that he was repeatedly frustrated in attempts to verify new developments there.
“They are just maintaining the place so it does not collapse. It’s like keeping the brain alive in case the human body wakes. The same situation also exists at the Jos Steel Rolling Mill,” he said.
Mrs Victoria Ola, a former staff member of the company who lived at the quarters, said that communities surrounding the steel company had become a shadow of themselves, in contrast to the vibrant socio-economic activities once witnessed in the area.
Ola, however, urged Nigerians to be patient with the government, as it was making efforts to resuscitate the plant and reduce overdependence on oil.
A government official, who requested anonymity, said most funds were allocated to personnel costs to maintain the facility, while capital projects got only 6.1 per cent of the budget, insufficient to deliver significant change in the short term.
Prof. Linus Asuquo, the Director-General (D-G) of the National Metallurgical Development Centre, Jos, at the maiden National Steel Summit in 2025, said ASCL was costing the country more than N1 billion annually in pensions, salaries, taxes, and administrative costs.
The Minister of Steel Development, Prince Shuaibu Audu, in his New Year message, said that Nigeria had advanced in discussions with prospective investors in China to facilitate the revival of the Ajaokuta steel plant.
The ministry, he said, facilitated a 500 million dollar investment by NNPCL and its partners for the establishment of five mini-liquefied natural gas plants within the Ajaokuta Steel plant.
Audu added that the ministry executed an MoU with the Federal Ministry of Defence for the local production of military hardware and the establishment of a military industrial complex within the Ajaokuta Steel Company.
This, he said, would be done in collaboration with the Defence Industries Corporation of Nigeria.
The minister said that in spite of constraints in 2025, particularly the non-release of funds for the implementation of the 2025 budget, it sustained its reform momentum through the prudent implementation of key components of the 2024 Appropriation Bill.
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