By Daniel Nduka Okonkwo
What should we tell our children? Should we tell them that Nigeria possesses enormous natural resources and has built major refining assets, but has struggled for decades to convert those assets into dependable industrial capacity. We should tell them that billions were committed to rehabilitation, yet the country continued to face the consequences of inadequate domestic refining. We should also tell them that a $1 billion investment in a privately developed refinery gave the national oil company a 7.25 per cent stake in an industrial facility operating at a scale that has changed the conversation about refining in Nigeria.
Nigeria is one of the world’s major crude oil producers, and it has spent decades and billions of dollars trying to revive its government-owned refineries, yet it repeatedly struggles to keep them operating. How do we explain that billions could be committed to turnaround maintenance while the country continued to depend heavily on imported petroleum products? And how do we explain the extraordinary contrast that emerged when the Nigerian National Petroleum Company Limited (NNPC) invested $1 billion in a privately developed refinery and ended up holding a 7.25 per cent stake in an industrial facility that is now operating at enormous scale?
These are not merely questions about oil. There are questions about public money, institutional capacity, accountability, and what Nigeria leaves behind for the generation that comes after us. The numbers alone tell a remarkable story.
Public estimates of the money spent over the years on turnaround maintenance and rehabilitation of Nigeria’s state-owned refineries have reached as much as $25 billion. But the figure remains contested: other prominent estimates have put the historical expenditure closer to $18 billion. In 2025, the House of Representatives announced an investigation into the reported $18 billion spent on turnaround maintenance of the state refineries. The important point, therefore, is not to pretend that $25 billion is an uncontested audited figure. It is to confront the underlying reality: Nigeria has spent many billions of dollars on its state refineries over several decades without achieving the sustained, commercially viable refining system Nigerians were promised.
Then there is the other side of the equation. In 2021, NNPC paid $1 billion towards a stake in the Dangote Petroleum Refinery and now holds 7.25 per cent. The contrast is extraordinary. One side represents decades of public expenditure and repeated rehabilitation attempts. The other represents a $1 billion investment in a privately developed refinery that has reached an industrial scale of production. That contrast deserves to be examined without slogans.
Nigeria’s state-owned refineries have become symbols of an uncomfortable paradox: enormous physical assets that have repeatedly struggled to deliver consistent value to the country. Port Harcourt, Warri, and Kaduna were built to reduce dependence on imported refined petroleum products and strengthen Nigeria’s domestic industrial capacity. Yet their histories have been marked by shutdowns, rehabilitation programmes, maintenance contracts, and repeated efforts to restore production. The problem is not simply that old refineries require maintenance. Every large industrial facility requires maintenance. The deeper problem is the recurring cycle in which substantial resources are committed to rehabilitation, expectations rise, a facility resumes or is expected to resume operations, and then another period of disruption follows.
Port Harcourt provides perhaps the clearest recent example. In 2021, the Federal Executive Council approved $1.5 billion for the rehabilitation of the refinery. After years of inactivity and rehabilitation work, the refinery resumed operations in November 2024. Yet by May 2025, NNPC announced a planned maintenance shutdown to conduct a comprehensive assessment and implement measures intended to ensure sustainable operations.
That sequence raises a straightforward question: what exactly did the country buy with the billions committed to these facilities? Was it merely a repaired plant capable of restarting, or was it supposed to be a commercially sustainable refinery capable of producing consistently over time? The distinction matters. A refinery can be restarted without becoming a successful refinery. A plant can produce for a period without proving that its economics, maintenance systems, management structure, and technical reliability are sustainable. The real test of rehabilitation is not the ceremony surrounding a restart. It is whether the facility can continue operating efficiently, reliably, and commercially.
The financial records add another dimension to the story. NNPC’s 2025 audited financial statements showed that Port Harcourt, Warri, and Kaduna refineries together had balances of about ₦8.31 trillion owed to NNPC at the end of 2025. Port Harcourt accounted for about ₦4.03 trillion, Kaduna about ₦2.31 trillion, and Warri about ₦1.97 trillion.
Because NNPC owns the three refineries outright, these balances are not the same as conventional commercial debt owed to unrelated outside creditors. They are intra-group obligations within the NNPC structure. But that does not make the numbers irrelevant. On the contrary, they raise questions about how much financing has continued to flow into assets that have struggled to generate corresponding productive value. During 2025 alone, NNPC extended about ₦264.4 billion in loans to the three refineries. The combined balance was also slightly lower than the roughly ₦8.67 trillion recorded a year earlier. These figures deserve scrutiny because they provide a financial picture of the continuing burden associated with the state refinery system.
The burden is not merely historical. At the time of writing, support staff at the Port Harcourt refinery have protested for over seven months over unpaid salaries and the non-implementation of a new salary structure. The workers issued a 48-hour ultimatum and threatened industrial action that could affect operations. A refinery struggling with production sustainability while its support workers are reporting prolonged salary arrears presents a troubling picture of institutional dysfunction.
What can be established is that Nigeria has repeatedly committed enormous resources to its refining infrastructure without obtaining the level of sustained industrial output those investments were supposed to deliver.
That is where the historical turnaround-maintenance question becomes important. Public reports have cited figures ranging from approximately $18 billion to as much as $25 billion when discussing the cumulative cost of rehabilitating Nigeria’s state-owned refineries. The $25 billion figure is an upper-end public estimate rather than an uncontested audited total. One prominent calculation linked it to reported spending of about ₦11.35 trillion converted at the prevailing exchange rate. The difference between $18 billion and $25 billion is itself significant. But whether the final historical figure is closer to one estimate or the other, the central accountability question remains the same: what measurable refining capacity did Nigeria obtain in return for the money spent?
The start-stop pattern also deserves investigation. When a refinery restarts and subsequently shuts down, the public should be able to see the technical explanation, the maintenance history, the production data, the contracts involved, and the cost of returning the facility to service. Without such transparency, each new rehabilitation exercise risks becoming another isolated expenditure rather than part of a coherent industrial strategy.
There is also a larger economic question. For decades, Nigeria’s dependence on imported petroleum products created a vast commercial ecosystem around fuel imports, shipping, storage, distribution, and financing. The existence of that ecosystem does not by itself prove that anyone deliberately sabotaged domestic refineries. But it does make it legitimate to ask who benefited financially from a system in which one of Africa’s largest crude oil producers remained heavily dependent on imported refined products.
That question should be viewed through documents, not accusations. Contracts, procurement records, import records, subsidy payments, maintenance invoices, inspection reports, production figures, and the identities of contractors and beneficiaries can reveal much more than political rhetoric. If wrongdoing occurred, evidence should establish it. If there was merely institutional incompetence, poor planning, or technical failure, the evidence should establish that too.
Nigeria did not merely watch a private company build a refinery; its national oil company became an equity investor in it. NNPC agreed in 2021 to acquire a 20 per cent interest in the Dangote Petroleum Refinery and paid $1 billion upfront. It did not complete the balance of the agreed consideration, leaving it with a 7.25 per cent stake. Dangote and NNPC have differed publicly over the circumstances surrounding the unpaid balance.
Whatever interpretation one adopts, the investment has produced an extraordinary contrast with the history of the state-owned plants. The Dangote refinery was developed privately and has reached a nameplate capacity of 650,000 barrels per day. In June 2026, Dangote announced that the refinery had demonstrated a processing rate of 700,000 barrels per day during a performance test conducted by its process licensors. That figure should not be confused with a claim that the refinery continuously produces 700,000 barrels per day commercially, but it demonstrates substantial processing capability.
The investment gives Nigeria an equity position in a major privately developed industrial asset while the country continues to wrestle with the financial and operational challenges of its own refineries.
The comparison becomes even more striking when one considers what each model was supposed to achieve. The state refinery model was intended to use public ownership and investment to secure domestic refining capacity. The Dangote model relied on private capital, private development, and commercial management, with NNPC becoming a minority investor. The question is not whether private ownership is automatically superior to public ownership. The question is why the two approaches have produced such different outcomes and what lessons Nigeria should draw from the difference.
NNPC’s new partnership discussions with Chinese companies introduce another chapter. In April 2026, NNPC signed a memorandum of understanding with Sanjiang Chemical Company Limited and Xinganchen (Fuzhou) Industrial Park Operation and Management Co. Ltd for a potential technical equity partnership involving the Port Harcourt and Warri refineries. The proposal includes technical support, completion and operation of the facilities, maintenance, and the possibility of future petrochemical and gas-related expansion.
NNPC has described the memorandum as reflecting a shared intent to progress discussions in good faith, with definitive arrangements to follow subject to further negotiation and regulatory approvals. The financial implications had also not been reliably established at the time of the announcement. Its significance is that Nigeria is again looking outside the traditional state-run model for capital, technical expertise, operational capacity, and a mechanism for sharing commercial risk.
That may become a new beginning. It may also become another test. The lesson from Nigeria’s refinery history is that signing an agreement is not the same thing as creating sustainable industrial capacity. What matters is whether the partnership can produce reliable operations, transparent costs, accountable management, and measurable output without simply transferring another financial burden to the Nigerian public.
The real failure was not spending money. Governments must spend money to build and maintain critical infrastructure. The failure occurs when expenditure becomes detached from measurable results. Nigerians should not have to celebrate every rehabilitation contract, commissioning ceremony, or temporary restart as proof of success. The real measure is sustained production, economic viability, technical reliability, and value for money.
We should also tell them that the story is not finished. The state refineries are not merely monuments to past failure. They remain public assets whose future should be determined by evidence, economics, and national interest. If they can be made commercially viable, they should be. If they cannot, Nigeria must have the courage to confront that reality rather than repeatedly spending money because billions have already been spent.
The question Nigeria cannot escape is, therefore, not simply how much was spent. It is what Nigeria actually bought with all those billions. Did it buy sustainable refining capacity, or did it repeatedly buy temporary restarts? Did it create industrial value, or did it merely postpone difficult decisions? And why did a country with enormous crude oil resources find itself repeatedly financing rehabilitation while a privately developed refinery emerged at a scale capable of reshaping the domestic petroleum market?
These questions require a forensic answer. Nigeria should be able to trace the contracts, contractors, payment records, technical reports, inspection findings, production data, downtime, maintenance expenditure, and financial obligations associated with every major refinery rehabilitation programme. It should be possible to establish what was promised, what was delivered, what failed, why it failed, and who benefited from each stage of the process. That is not an attack on public institutions. It is the minimum standard of accountability expected when public resources are involved.
Our children should not inherit another cycle of promises, rehabilitation ceremonies, and abandoned industrial capacity. They should inherit institutions capable of learning from failure, protecting public assets, and investing where the country can obtain measurable value. The ultimate lesson from Nigeria’s refinery saga is not that public ownership is inherently bad or private ownership is inherently good. It is that capital without accountability, maintenance without sustainability, and investment without measurable outcomes can become enormously expensive.
Nigeria has spent enough time asking how much more it can spend. It must now ask what each naira and dollar of public investment is actually producing. The future cannot be built on expenditure alone. It must be built on results.
Public money must produce public value.
Daniel Nduka Okonkwo is an investigative journalist, human rights advocate, and policy analyst based in Nigeria. He is the founder and publisher of Profiles International Human Rights Advocate (PIHRA), a platform documenting the courage of human rights defenders and examining issues of governance, accountability, security, and fundamental rights.
His reporting on Nigerian governance, security-sector accountability, public finance, and human rights has appeared in Sahara Reporters, Vanguard, Daily Trust, African Defence Forum, Opinion Nigeria, and Daily Intel.
Read more of his work on the PIHRA website:
https://www.profilesinternationalhumanrightsadvocate.com.ng/
For tips, feedback, or collaboration, contact him at dan.okonkwo.73@gmail.com.
