The Nigerian National Petroleum Company (NNPC) Limited is re-evaluating its refinery rehabilitation strategy and may consider selling off its long-troubled state-owned refineries due to increasing complexities, according to its Group Chief Executive Officer, Bayo Ojulari.
Speaking during an exclusive interview with Bloomberg on the sidelines of the 9th OPEC International Seminar in Vienna, Austria, NNPC Ojulari disclosed that despite heavy investment over the years, the rehabilitation of Nigeria’s decades-old refineries has proven more complicated than anticipated.
“We’ve made quite a lot of investment and brought in new technologies, but some of those haven’t worked as expected,” Ojulari explained. “When you’re dealing with refineries that have been neglected for a long time, the complications are deeper than surface-level fixes.”
Although the Port Harcourt refinery briefly resumed operations in November 2024, it was shut down again in May 2025 for maintenance. Meanwhile, the Warri and Kaduna refineries are still undergoing long-delayed repairs.
Ojulari revealed that the NNPC is currently undertaking a strategic review of its entire refinery portfolio, with outcomes expected before the end of 2025.
While a final decision has not been made, Ojulari emphasized that a sale is one of the options under serious consideration.
“Sale is not off the table,” he said. “All options are on the table, but our final decision will be based on the comprehensive review we’re conducting now.”
The move, if adopted, could signal a dramatic shift in Nigeria’s downstream oil strategy, one that aligns with global trends where national oil companies are divesting from legacy infrastructure to prioritize cost-efficiency, sustainability, and cleaner energy investments.
Ojulari also touched on another critical issue affecting the sector: soaring production costs. He noted that Nigeria’s average crude oil operating cost currently ranges between $20 and $30 per barrel, significantly higher than in many other oil-producing nations.
“A major reason for this is the massive investments we’ve made to secure our pipeline infrastructure,” he said. “As of today, we have 100% pipeline availability, but this level of stability came at a steep price.”
With the recent improvements in pipeline security, Ojulari expressed hope that operating costs would gradually decline over time. Still, he acknowledged that current figures are unsustainable if Nigeria is to compete globally.
Despite these hurdles, the NNPC is aiming to raise daily oil production to 1.9 million barrels per day (bpd) by the end of 2025. This is part of broader efforts to boost export earnings, stabilize forex supply, and reduce the country’s heavy dependence on petroleum imports.
The development comes amid wider concerns over the effectiveness of Nigeria’s multi-billion-dollar refinery rehabilitation program. Industry observers, including private sector leaders like Aliko Dangote, have previously questioned the viability of reviving aged state-owned refineries when modular and privately-run facilities like the Dangote Refinery are coming online.
Energy analysts suggest that a potential sale of NNPC’s refineries could unlock value for the government while encouraging private-sector-led refinery development. However, concerns remain about transparency, valuation, and ensuring that such sales do not turn into sweetheart deals or monopolies.
“NNPC needs to conduct this process with full public disclosure and accountability,” said Kola Aina, an oil policy analyst. “If executed well, divesting from inefficient refineries could free up resources for cleaner, modern energy infrastructure.”
As Nigeria battles with rising operational costs and aging infrastructure, the NNPC’s pivot toward potential refinery divestment marks a critical juncture in the country’s energy transition. With billions already spent and limited returns, the decision could either reset the sector or further erode public confidence, depending on how it is handled.