Obasanjo Opens Up About How Dangote’s $750m Offer to Manage Nigeria’s Refineries Was Rejected
- Former President Obasanjo revealed that repeated attempts to privatize Nigeria's refineries during his tenure were thwarted by corruption and inefficiency
- Shell declined offers to manage the refineries, citing small capacities, poor maintenance, and systemic corruption in the downstream sector
- Obasanjo contrasted the government's inefficiency with Aliko Dangote's private refinery, expressing confidence in its ability to succeed
Former Nigerian President Olusegun Obasanjo has opened up about the challenges his administration faced in attempting to privatise and rehabilitate the country’s refineries.
Speaking in an exclusive interview with Channels TV on Thursday, Obasanjo detailed the repeated setbacks that left the Port Harcourt, Warri, and Kaduna refineries underperforming and financially draining.
Source: Getty Images
Former president recounts involving Shell
Obasanjo recounted efforts to engage Shell, a major player in the oil and gas industry, to manage and rejuvenate the facilities. However, Shell declined multiple offers, citing several concerns.
“I asked Shell to come and run it for us and Shell said they wouldn’t. I said, ‘Please come and take equity,’ and they still said no,” Obasanjo said.
Even when equity participation was removed from the table, Shell remained disinterested, providing reasons that painted a bleak picture of Nigeria’s downstream sector.
Shell’s reluctance stemmed from several issues: the small capacity of Nigeria’s refineries, which ranged from 60,000 to 120,000 barrels per day compared to an industry average of 250,000 barrels; poor maintenance practices; and pervasive corruption within the system.
“They make major profits from upstream, not downstream,” Obasanjo added, underscoring Shell’s hesitation.
Aliko Dangote stepped in to revive refineries
When Shell’s support fell through, Africa’s richest man, Aliko Dangote, assembled a team to take over the refineries through a public-private partnership (PPP).
Dangote’s consortium reportedly paid $750 million to manage the facilities. However, Obasanjo’s successor reversed the arrangement, refunding Dangote’s payment.
“NNPC said they wanted the refinery and could run it,” Obasanjo said, adding, “But you know they cannot run it.”
Since then, Obasanjo claimed, over $2 billion has been spent on the refineries with little to show for it.
He contrasted the government’s inefficiency with Dangote’s private refinery, expressing confidence in its potential to succeed.
“If anybody tells you now that [the refineries] are working, why are they now with Aliko? And Aliko will make his own refinery work,” he stated.
Dangote announces cheaper Petrol price
Earlier, Legit.ng had reported that the Dangote Petroleum Refinery had stepped up its efforts to persuade marketers to purchase its petroleum products.
The refinery recently advertised how marketers could enquire about the high-quality PMS offered by the company.
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Source: Legit.ng
