Former Nigeria’s President, Chief Olusegun Obasanjo has explained the reason why Shell refused to buy equity stake in Nigeria’s refinery during his times as President between 1999 and 2007.
Chief Obasanjo stated this in a film interview with Financial Times on Nigeria’s oil industry and the role of the Dangote refinery in meeting the country and West Africa’s petrol demands going forward.
According to him, Shell refused equities in Nigeria’s refineries because they were poorly managed and maintained hence the oil giant declined to be part of the “mess”.
He said, “When I was President, I invited Shell, and I said come and take equity participation and run our refineries for us. They refused and said our refineries have not been well maintained. We have brought amateurs rather than professionals. They said there is too much corruption with the way our refineries are run and maintained, and they did not want to get involved in such a mess.”
Chief Obasanjo also shared his opinion following recent allegations by the President of the Dangote Group, Aliko Dangote, that certain government and non-government officials were attempting to obstruct the $20 billion refinery project.
He stated that those profiting from fuel importation would do everything in their power to hinder the Dangote Petroleum Refinery.
The former leader remarked that Aliko Dangote’s investment in a refinery, if successful, should encourage both Nigerians and non-Nigerians to invest in Nigeria.
He also noted that those selling or supplying refined products to Nigeria might feel threatened by the potential loss of their lucrative opportunities and would likely make every effort to frustrate Dangote’s efforts.
Problems with Nigerian refineries
Nigerian has tried unsuccessfully to get its four refineries to process crude oil sourced locally from the country as they have over time fallen into disrepair.
The 9th National Assembly in a report stated that in the decade preceding 2023, around $25 billion was spent on repairs and maintenance works on the nation’s refineries without success in making them work.
In March 2021, the federal government approved a $1.5 billion contract for the repair of the Port-Harcourt refinery, which has a capacity of 210,000 barrels.
The rehabilitation project, awarded to the Italian company Tecnimont SPA, was planned to be completed in three phases over 18, 24, and 44 months.
Similar contracts were also awarded for repairs of the Warri and Port-Harcourt refinery but have consistently failed to meet completion deadlines. Last month, the GCEO of the NNPCL, Mele Kyari disclosed that the Port-Harcourt refinery will become functional by December of this year.
