THE Group Chief Executive Officer of the Nigerian National Petroleum Company Limited (NNPC Ltd), Bayo Ojulari, has revealed that Nigeria’s state-owned refineries were operating at what he described as a “monumental loss” to the country, forcing his management team to halt operations to prevent further erosion of national value.
News Point Nigeria reports that Ojulari made the disclosure on Wednesday in Abuja during a fireside chat titled “Securing Nigeria’s Energy Future” at the Nigeria International Energy Summit (NIES) 2026, offering one of the most candid explanations yet of the commercial realities behind NNPC’s controversial refinery shutdowns.
According to the NNPC chief, widespread public anger over the refineries was understandable, given the billions of dollars invested in their rehabilitation over the years and the high expectations Nigerians had placed on the facilities.
“On the refineries, Nigerians were angry. A lot of money has been spent, and expectations were very high. So we were under extreme pressure, extreme pressure,” Ojulari said.
Ojulari admitted that when he assumed office, refinery operations were not his area of professional expertise, having spent most of his over three-decade career in the upstream segment of the oil and gas industry. However, he said the weight of accountability left no room for hesitation.
“My background is upstream, so I was on a vertical learning curve. You are accountable, so you must learn very quickly. Otherwise, there is no escape,” he said.
He explained that once his leadership team conducted a detailed review of refinery operations, the financial situation became immediately alarming.
“The first thing that became clear, and I want to say this very clearly, is that we were running at a monumental loss to Nigeria. We were just wasting money. I can say that confidently now,” Ojulari declared.
The NNPC boss revealed that the company was regularly feeding crude oil cargoes into the refineries every month, yet capacity utilisation hovered between 50 and 55 per cent, leading to massive value destruction.
“We were spending a lot of money on operations, a lot of money on contractors. But when you look at the net, we were just leaking away value,” he said.
More concerning, Ojulari said, was the absence of any credible turnaround strategy that could justify continued operations despite losses.
“Sometimes you make a loss during investment, but you have a line of sight to recovery. That line of sight was not clear here,” he noted.
Faced with this reality, the NNPC chief said the first major decision of his administration was to halt refinery operations and carry out an urgent reassessment.
“We decided to stop the refinery and do a quick check. We planned that if things were lined up, we would reopen and work on them,” Ojulari explained.
He disclosed that part of the value erosion stemmed from the quality of refined products being produced, particularly at the Port Harcourt Refinery.
“The crude we were taking into Port Harcourt was producing mid-grade products. When you aggregate their value compared to what you put in, it was a waste,” he said.
Ojulari acknowledged that shutting down the refineries was politically sensitive, given longstanding pressure on NNPC to keep the plants running to guarantee domestic fuel supply and reduce import dependence.
“There were political pressures to keep the refinery product, lots of pressure. But when you have been trained for over 35 years to focus on commerciality and profitability, you can’t sleep with that,” he said.
Nigeria’s four state-owned refineries, Port Harcourt (two plants), Warri, and Kaduna have for decades struggled with chronic underperformance, despite repeated turnaround maintenance exercises that have consumed billions of dollars.
At various times, the plants have operated at single-digit capacity or remained completely shut, forcing Africa’s largest oil producer to rely heavily on imported refined petroleum products.
Between 2015 and 2023, successive governments approved multiple rehabilitation contracts for the refineries, yet domestic refining output remained negligible, intensifying public criticism of NNPC’s efficiency and governance.
Ojulari’s remarks represent one of the clearest acknowledgements by an NNPC chief executive that, under prevailing conditions, continued operation of the refineries was economically unjustifiable.