The Nigerian National Petroleum Company Limited (NNPC) is considering selling some of its refineries as part of a broader strategic overhaul, according to its Group Chief Executive Officer, Bayo Ojulari.
Speaking with Bloomberg on Thursday during the 9th OPEC International Seminar in Vienna, Austria, Ojulari revealed that a comprehensive review of NNPC’s refinery operations is currently underway and should be completed before year-end.
“We’re reviewing all our refinery strategies now. We hope to conclude that review before the end of the year,” he said. “That review may lead to us doing things slightly differently.”
When asked if a sale of the refineries was on the table, Ojulari confirmed that the option is being considered. “Sale is not out of the question,” he said. “All the options are on the table, to be frank, but that decision will be based on the outcome of the reviews we’re doing now.”
Nigeria has long struggled to revive its state-owned refineries in Port Harcourt, Warri, and Kaduna. Although the Port Harcourt refinery briefly resumed operations in November 2023, it was shut down again in May 2024 for maintenance.
Ojulari blamed the setbacks on aging infrastructure and ineffective technology. “We’ve made significant investments over the years and introduced new technologies, but some haven’t performed as expected,” he said. “Refurbishing old, long-abandoned refineries has proven to be more complex than anticipated.”
He also highlighted the high cost of crude oil production in Nigeria, which currently ranges between $25 and $30 per barrel. This, he said, is partly due to heavy spending on securing oil pipelines.
“The operating cost alone hovers above $20 per barrel,” Ojulari noted. “We’ve invested heavily in pipeline security, which has resulted in 100% pipeline availability today. While this has driven up costs, we expect them to decline over time with greater stability.”
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Despite these hurdles, Ojulari stated that NNPC aims to ramp up Nigeria’s oil production to 1.9 million barrels per day by the end of the year.
