The Group Chief Executive Officer of the Nigerian National Petroleum Company Limited (NNPC), Bayo Ojulari, has revealed that Nigeria’s state-owned refineries were bleeding public funds, forcing his management team to suspend operations to prevent further financial damage.
Ojulari made the disclosure on Wednesday in Abuja during a fireside chat titled “Securing Nigeria’s Energy Future” at the Nigeria International Energy Summit 2026, offering rare insight into the harsh economic realities facing the nation’s refining assets.
He acknowledged widespread public frustration over the refineries, noting that billions of naira had been invested over the years with little to show for it.
“Nigerians were angry, and rightly so. A lot of money has been spent, and expectations were extremely high. So we were under immense pressure,” Ojulari said.
Admitting that refining was not his core area of expertise, Ojulari explained that his professional background lies in upstream operations. However, he stressed that leadership responsibility demanded swift adaptation.
“My background is upstream, so I had to learn very fast. You are accountable, and there’s no escape from that,” he stated.
According to him, a detailed internal review quickly exposed the scale of the problem.
“We realised almost immediately that we were running at a monumental loss to Nigeria. We were simply wasting money,” he said.
Ojulari disclosed that NNPC was regularly supplying crude oil to the refineries, yet utilisation remained between 50 and 55 per cent, leading to massive value erosion.
“We were spending heavily on operations and contractors, but at the end of the day, value was just leaking away,” he added.
More concerning, he said, was the absence of any realistic pathway to profitability.
“In some investments, you may record losses initially, but you usually have a clear line of sight to recovery. In this case, that line of sight simply did not exist.”
Faced with these realities, Ojulari said his administration took the difficult decision to halt refinery operations and conduct an urgent reassessment.
“Our first major action was to stop the refineries and carry out a quick review. The idea was to reopen once things were properly aligned,” he explained.
He further revealed that part of the losses stemmed from poor product quality, citing the Port Harcourt Refinery, where crude processing yielded largely mid-grade products that failed to justify input costs.
“When you compare the value of what came out with what went in, it was simply not adding up,” he said.
Ojulari acknowledged the political sensitivity of shutting down the refineries, noting that NNPC has historically faced pressure to keep them running in order to guarantee fuel supply.
“There was a lot of pressure to keep producing. But when you’ve been trained for over 35 years to focus on commercial viability, you can’t ignore the numbers,” he said.
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Nigeria’s four government-owned refineries — Port Harcourt (two plants), Warri, and Kaduna — have long struggled with underperformance despite multiple turnaround maintenance projects costing billions of dollars. For years, the facilities have operated far below capacity or remained idle, forcing Africa’s largest oil producer to depend heavily on imported petroleum products.
Between 2015 and 2023, successive governments approved several rehabilitation contracts, yet domestic refining output remained largely insignificant, deepening public concern over NNPC’s efficiency.
Ojulari’s remarks represent one of the most forthright admissions by an NNPC chief executive that continuing refinery operations under existing conditions was economically unsustainable.
Analysts say the statement reflects a growing commitment to commercial discipline within the company following reforms introduced by the Petroleum Industry Act.