Local refiners reported on Thursday that the persistent crude oil shortage has greatly affected investments in seven new and existing refineries across the country.
They cautioned that without a stable crude supply, attracting investors, boosting local refining capacity, and cutting reliance on imports may remain out of reach.
Eche Idoko, the National Publicity Secretary of the Crude Oil Refinery-owners Association of Nigeria, disclosed this in an exclusive interview on Thursday.
Data from the Nigerian Upstream Petroleum Regulatory Commission indicates that 15 operators have refinery construction licenses, with a combined refining capacity of 1,151,500 barrels per day.
Just 852,000 bpd of this capacity is operational, sparking concerns over underutilized refinery infrastructure nationwide.
Refinery owners struggle with crude supply shortages, a key challenge in the sector.
Analysis shows that five licensed refineries remain non-operational, while three facilities assigned daily crude allocations by the NUPRC are currently inactive.
Findings show that the 10,000 bpd OPAC refinery is inactive due to poor feedstock, while the 2,500 bpd Duport refinery is also non-operational. Additionally, the state-owned Kaduna refinery remains idle despite approval to refine products.
These licenses, issued to private investors in the midstream sector, were intended to boost Nigeria’s refining capacity and reduce reliance on imported petroleum products.
Despite widespread approvals, the refineries’ operational capacity remains far below their licensed potential.
Idoko pointed to additional challenges hindering full operations, including inadequate funding, project delays, and technical issues. As a result, the country continues to rely on aging refineries struggling to meet domestic fuel demand.
The Dangote refinery recently suspended petroleum product sales in naira over concerns about the naira-for-crude arrangement and inconsistencies between crude allocations paid for in naira and actual sales.
Sources disclosed that the Nigerian National Petroleum Company Limited diverted large crude volumes to foreign creditors to settle loans, complicating the naira-for-crude deal with Dangote refinery.
Idoko stressed that the capacity gap extends beyond funding issues, highlighting crude supply assurance as a major technical challenge.
