There was political pressure to keep NNPC refineries running despite huge losses

The group chief executive officer (CEO) of the Nigerian National Petroleum Company (NNPC) Limited, Bayo Ojulari on Wednesday said the Warri, Port Harcourt, and Kaduna refineries were shut down because they were incurring monumental losses.

Ojulari, who spoke at the ongoing Nigerian International Energy Summit (NIES), disclosed that there was political pressure to keep the lights on at the plants.

The NNPC had shut down the Port Harcourt Refining Company (PHRC) for maintenance in May 2025.

Operations at the Warri and Kaduna refineries were also halted for rehabilitation work.

In November of the same year, the national oil company announced plans to partner with private refinery operators to fix the ailing plants, after a review of the refineries.

Speaking on the rationale behind the decision, the NNPC GCEO said upon his appointment, his leadership team aimed to understand “what was happening in the refinery”.

“The first thing that became clear is that we were running at a monumental loss to Nigeria. We were just wasting money. I can say that confidently now,” Ojulari said.

“So the first decision that I had to make was to stop the rot by ensuring that we stop and first of all, calibrate quickly, rebase, to see what we do. You wonder how we were losing money.”

He said although the country was pumping cargoes into the refineries monthly, utilisation levels were only about 50 percent to 55 percent.

“We were spending a lot of money on the operations, a lot of money on the contractors. But if you then look at the net, we were just leaking away a lot of value,” Ojulari said.

The GCEO said there was no clear plan to convert the losses into gains, adding that the path to improvement was unclear.

“So we decided to just stop the refinery and do a quick check. Our plan was that if things were all lined up, we would reopen them and maybe work on them,” Ojulari said.

The NNPC chief disclosed that the Port Harcourt refinery was producing mid-grade products.

“We realised that we were destroying value also because the crude we were taking into Port Harcourt refinery, for example, we were coming up with mid-grade products,” he said.

Ojulari said the operation was wasteful, considering the total value of the products versus the input.

He said there was political pressure to keep the refinery running since the NNPC was the supplier of last resort.