Group Chief Executive Officer of the Nigerian National Petroleum Company (NNPC), Bayo Ojulari, has linked the persistent collapse of Nigeria’s state-owned refineries to weak operational capability, saying the system was structured in a way that destroyed value instead of sustaining it.
Speaking at the Nigerian International Energy Summit, Ojulari explained that an internal assessment of the refineries uncovered deep structural problems that would have continued to drain national resources for decades if nothing changed. He said this discovery forced NNPC to suspend existing processes and begin a comprehensive review of refinery operations.
Ojulari noted that three key factors are required for any refinery to succeed: strong financing, a capable Engineering, Procurement and Construction (EPC) contractor, and a world-class operational system to manage the facility long term. According to him, Nigeria historically focused heavily on funding and construction while ignoring the operational component, which he described as the most critical.
He explained that financiers and contractors typically earn their returns and leave, while the responsibility of running the refinery remains with the operator for decades. Without strong operational systems and technical supervision, he said the refinery becomes a financial drain.
Ojulari added that past models relied heavily on multiple contracts — including financing, EPC and operations and maintenance — all drawing money from the system without long-term accountability or performance risk.
He said the new direction would focus on building strong operational excellence from the start of any refinery project, including involving operational experts early to ensure facilities are built to run efficiently and profitably.
Recent reports support his position, noting that NNPC halted refinery operations after reviews showed they were destroying value and recording heavy losses despite large financial investments.
Ojulari Reveals Why Billions Failed to Fix Nigeria’s Refineries
