Obasanjo lamented the government’s decision, noting that over $2 billion has since been spent on the refineries without significant improvement.
Abeokuta, Nigeria – Former President Olusegun Obasanjo has disclosed how Nigeria’s refineries have continued to struggle despite attempts to privatize and rehabilitate them, highlighting a rejected $750 million offer from Africa’s richest man, Aliko Dangote, to manage the facilities.
In an exclusive interview with Channels Television, Obasanjo recounted efforts during his administration to address the inefficiencies of the Port Harcourt, Warri, and Kaduna refineries. He revealed that attempts to involve international companies like Shell and private investors met resistance from multiple quarters.
The former president explained that he initially sought Shell’s assistance to rehabilitate and manage the refineries. However, the oil giant declined, citing several reasons. According to Obasanjo, the Shell executive pointed out the following challenges:
- Profitability Concerns: Shell’s major profits came from upstream operations, while downstream operations barely broke even.
- Capacity Limitations: Nigeria’s refineries were considered too small, with capacities of 60,000, 100,000, and 120,000 barrels, compared to the global average of 250,000 barrels at the time.
- Poor Maintenance: The refineries were poorly maintained, making them unattractive for investment.
- Corruption: Widespread corruption in refinery operations deterred Shell from getting involved.
Dangote’s $750 Million Offer Rejected
Following Shell’s refusal, Obasanjo turned to Aliko Dangote, who assembled a team and offered $750 million to manage the refineries through a public-private partnership (PPP). However, Obasanjo revealed that his successor refunded Dangote’s investment, opting to retain the refineries under government control.
“I went to my successor and explained the situation,” Obasanjo said. “He told me that the Nigerian National Petroleum Corporation (NNPC) believed they could run the refineries themselves. I told him they could not.”
The former president lamented the government’s decision, noting that over $2 billion has since been spent on the refineries without significant improvement. He expressed confidence in Dangote’s ability to efficiently manage his privately-owned refinery, contrasting it with the inefficiency of government-operated facilities.
“If Shell tells me what they told me, I will believe them,” Obasanjo said. “If anyone claims the refineries are working, why are they now relying on Aliko? He will make his refinery work and deliver results.”
Using a Yoruba proverb, Obasanjo criticized inflated claims about the refineries’ performance, likening them to planting 100 heaps of yam and falsely claiming to have planted 200.
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