In a recent development, President Bola Tinubu has expressed his unwavering belief in the revival of Nigeria's state-owned refineries, particularly those in Port Harcourt and Warri, despite the doubts cast by his predecessor, former President Olusegun Obasanjo. This bold statement from Tinubu marks a clear departure from Obasanjo's long-held skepticism about the viability of these refineries, which have been plagued by years of inactivity and failed rehabilitation attempts.
The crux of the matter lies in the differing perspectives on how to best manage these critical assets. While Tinubu maintains that the refineries can be brought back to life and made profitable, Obasanjo advocates for a public-private partnership model, citing his own experiences during his presidency from 1999 to 2007. Obasanjo's argument is rooted in the belief that the Nigerian National Petroleum Company Limited (NNPC) lacks the expertise to successfully operate these government-owned refineries.
Obasanjo's stance is further supported by his interactions with Shell, a major oil company. He recounts how Shell declined his invitation to take a 10% equity stake and run the refineries, citing various reasons, including the small size of the Nigerian refineries, poor maintenance, and pervasive corruption. Obasanjo also highlights an offer from Aliko Dangote, who proposed a 51% stake in two of the refineries for $750 million, an offer that was later reversed by Obasanjo's successor.
On the other hand, Tinubu's position aligns with that of the current NNPC boss, Bayo Ojulari, who recently announced a memorandum of understanding with two Chinese companies to fix the Port Harcourt and Warri refineries. Tinubu's administration now faces the challenge of proving that these facilities can transition from mere restart announcements to sustained, commercially viable refining operations.
However, not everyone shares Tinubu's optimism. Energy expert Dan Kunle faults the continued rehabilitation efforts, arguing that the President should privatize the facilities and redirect public funds to other sectors of the economy. Kunle believes that the information being presented to Tinubu is biased and influenced by self-interested managers of the refineries. He challenges the government to build a new refinery alongside the existing ones to demonstrate the viability of the old plants, a move he believes would expose their operational and financial shortcomings.
Kunle's argument is further strengthened by the fact that Nigeria has traveled down this road before without success. He questions why successive administrations, including those of Yar'Adua, Jonathan, and Buhari, have failed to revive the refineries despite repeated assurances. Kunle urges Tinubu to open up various sectors of the economy to investment, leveraging his power to create new opportunities and develop critical areas like education and agriculture.
Interestingly, the Port Harcourt Refinery Host Community Bulk Petroleum Retailers Association has pledged its support to Tinubu, promising to double the votes he received in Rivers State if the refinery becomes fully operational before the next general election. This political backing underscores the potential economic and political significance of the refinery's revival, which could create jobs, stimulate businesses, and improve energy security in the region.
In conclusion, the debate over the future of Nigeria's state-owned refineries is a complex one, with differing opinions and strategies proposed by key stakeholders. While Tinubu remains optimistic about the refineries' potential, the challenges of rehabilitation, profitability, and accountability loom large. The coming years will be crucial in determining whether Tinubu's administration can successfully navigate these challenges and deliver on its promises.
