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Yesterday, the Nigerian National Petroleum Corporation (NNPC) released its unaudited monthly financial and operations report for the month of September 2019. According to the report, the four refineries owned by the Federal Government lost a combined N7.1 billion (August 2019 – N13.2 billion) in September.

Consequently, the cumulative loss for the first nine months of 2019 comes to N111.3 billion. However, the NNPC Group recorded surplus of N8.6 billion (August 2019 – N5.2 billion) for the month.

Despite the overall m/m improvement in the performance of the group, we remain concerned about the state of refinery operations, where sustained operational losses have continued to drag the group’s performance.

For the third consecutive month, capacity utilisation was 0.0%- this was attributed to ongoing rehabilitation works at the refineries. Notably, the 0.0% capacity utilisation has occurred in six of the past 12 months while peaking at 13.2% in February 2019.

This comes against the backdrop of the promise made by the Buhari-led administration to revamp all the refineries and ensure they are operating at a minimum of 90.0% capacity. We note the combined capacity of the four refineries (two in Port Harcourt and one each in Kaduna and Warri) stands at 445,000 bpd, however, Nigeria still relies heavily on the importation of PMS and other petroleum products to meet local demand.


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We struggle to see the possibility of achieving the president’s target of 90.0% capacity utilisation in the medium to long term. We recall that the process for raising funds broke down after talks with third-party financiers stalled in 2018 following disagreements on key commercial terms. We believe the government is ultimately relying on the launch of the 650,000 bpd Dangote refinery.

Standard chartered



Standard chartered

Member of the Nigerian Stock Exchange,


First City Plaza, 44 Marina,

PO Box 9117,

Lagos State,





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