Nigeria’s state-owned refineries have absorbed an estimated ₦13.2 trillion in public funds over 2023 and 2024, yet continue to function as loss-making assets with no meaningful commercial output. The massive spending, channelled through the Nigerian National Petroleum Company Limited (NNPC), went largely into turnaround maintenance programmes, operational costs, and mounting bank charges, even as the facilities remained largely non-performing.
Despite repeated rehabilitation efforts, the Port Harcourt, Warri, and Kaduna refineries failed to achieve sustainable production levels, turning them into financial liabilities rather than productive national assets. This reality was openly acknowledged by NNPC’s Group Chief Executive Officer, Bayo Ojulari, who described the refineries as a severe economic burden on the country. He admitted that their operations represented a “monumental loss” to Nigeria and that continued investment in them amounted to wasteful expenditure.
Ojulari made the remarks during a policy dialogue session in Abuja at the Nigeria International Energy Summit 2026, where he provided an unusually frank assessment of the refineries’ commercial condition. According to him, the scale of public frustration over the refineries was understandable, given the volume of funds committed to their revival and the expectations that local refining would reduce fuel supply pressures and import dependence.
Financial disclosures from NNPC show that the combined liabilities of the three refineries rose sharply within two years. In 2023, their outstanding obligations to the national oil company stood at about ₦4.52 trillion. By the end of 2024, this figure had surged to ₦8.67 trillion, bringing the cumulative total to roughly ₦13.2 trillion. These balances reflect funds provided for maintenance, daily operations, financing costs, and other support services, which were recorded as debts owed to NNPC by its refinery subsidiaries.
The Port Harcourt refinery accounted for the largest share of the financial exposure, with its liabilities more than doubling within a year. Warri and Kaduna refineries followed similar trajectories, each recording sharp increases in debt as spending on maintenance, personnel, security, and contractors continued without corresponding revenue generation. Across all three facilities, the pattern remained the same: rising costs, weak output, and no sustainable income streams.
Ojulari disclosed that crude oil supply to the refineries was ongoing, but production performance remained poor, with utilisation rates struggling to exceed 55 per cent. He noted that while large sums were being spent on operations and external contractors, the overall outcome was continuous value destruction rather than economic returns. More critically, he said the new management found no clear recovery pathway that could justify continued financial exposure.
This assessment led to a strategic decision to suspend refinery operations to prevent further financial losses and allow for a fundamental review of the assets. By the end of 2024, the refineries were still carrying ₦8.67 trillion in outstanding obligations, highlighting the depth of the financial challenge created by years of unsuccessful rehabilitation efforts.
Past attempts to restart the refineries produced only short-lived results, with brief reopenings followed by renewed shutdowns. While prominent voices in the private sector and former public officials have called for the disposal of the assets, the NNPC leadership has rejected the idea of selling them off, insisting that the refineries can still be made functional.
As debates continue over their future, the refineries remain symbols of heavy public investment, unresolved structural problems, and an uncertain path toward sustainable domestic refining in Nigeria.
