The Nigerian National Petroleum Company Limited (NNPCL) is not ruling out the possibility of divesting from its non-operational refineries in Kaduna, Port Harcourt in Rivers State, and Warri in Delta State as part of a comprehensive review of its downstream portfolio.
Speaking to Bloomberg at the OPEC International Seminar in Vienna, the Group CEO of NNPCL, Bayo Ojulari, acknowledged that recent investments in upgrading the refineries have not yielded the desired results due to legacy technical complexities.
He explained: “We’ve made quite a lot of investments in our refineries over the last several years and brought in a lot of technology. We’ve been challenged – some of those technologies have not worked as expected so far. But also, as you know, when you are refining a very old refinery that has been abandoned for some time, what we found is that they are a little bit more complicated.”
Ojulari revealed that a strategic overhaul is underway, and while no firm decision has been made, all options, including a potential sale, are under consideration.
“I can’t say that now. But what we are saying is that sale is not out of the question. But all the options are on the table. But that decision will be based on the outcome of the review,” he stated.
On infrastructure protection, Ojulari outlined a more sustainable security framework involving local communities and government agencies, which has replaced the old model dependent solely on police enforcement.
“I can give a lot of assurances concerning our pipelines… So my confidence is built on the premise that today’s security is driven by the communities, far more than what we had before. So, I am quite optimistic.”
Addressing crude supply arrangements with the Dangote Refinery, Ojulari reaffirmed that all deals would be strictly commercial.
“First of all, Dangote refinery is a commercial investment, and I think it is very important to keep that in mind… if Nigeria is going to supply more crude to the Dangote refinery, it will be on a commercially willing buyer, willing seller basis and not because it is a policy.”
Nigeria aims to boost daily crude oil production to 2.06 million barrels by 2027, with current levels already surpassing 1.63 million barrels per day, including condensates. The country also plans to ramp up gas production from 7 billion to 10 billion cubic feet within the same period.
