NNPC Shuts Down Refineries Over ‘Monumental Losses’ – CEO Ojulari Reveals Shocking Details

The Group Chief Executive Officer of the Nigerian National Petroleum Company Limited (NNPCL), Bayo Ojulari, has revealed that Nigeria’s state-owned refineries were bleeding the nation dry with “monumental losses,” forcing his team to halt operations to stem further financial hemorrhage.

Speaking at a fireside chat titled “Securing Nigeria’s Energy Future” during the Nigeria International Energy Summit 2026 in Abuja on Wednesday, Ojulari provided a rare glimpse into the dire commercial and operational challenges plaguing NNPCL’s refining assets. He acknowledged the public’s justified outrage over the refineries, given the billions of naira poured into them over the years with little to show for it.

“Nigerians were angry. A lot of money has been spent, and expectations were very high. So we were under extreme pressure, extreme pressure,” Ojulari stated.

Coming from an upstream background, Ojulari admitted he was on a steep learning curve upon taking office but emphasized the need for swift accountability. “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.

A detailed internal review exposed the harsh reality: the refineries were operating at a massive loss. “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.

He explained that despite monthly crude oil supplies, utilization rates lingered at 50-55 percent, leading to significant value leakage. “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 added. More alarmingly, there was no viable plan for recovery. “Sometimes you make a loss during investment, but you have a line of sight to recovery. That line of sight was not clear here,” Ojulari noted.

This prompted the tough decision to suspend operations for a 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,” he said. Using the Port Harcourt Refinery as an example, Ojulari highlighted how input crude yielded only mid-grade products, resulting in net losses. “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 revealed.

Despite political pressures to maintain operations for fuel supply continuity, Ojulari prioritized commercial viability. “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 asserted.

Nigeria’s four state-owned refineries – two in Port Harcourt, one in Warri, and one in Kaduna – have long been a symbol of inefficiency. Commissioned between 1965 and 1989 with a combined capacity of 445,000 barrels per day, they have operated well below potential, often at single-digit utilization or completely shut down, compelling Africa’s top oil producer to import nearly all its fuel needs.

As earlier reported by NaijaChoice News, successive governments have sunk billions into rehabilitation efforts, including a $1.5 billion contract for Port Harcourt in 2021 and over $18 billion probed by lawmakers for the three main refineries from 2000 to 2025, yet output remains negligible amid allegations of mismanagement and corruption.

Ojulari’s candid admission signals a pivot under the Petroleum Industry Act toward greater commercial discipline, even in sensitive areas like domestic refining. NNPCL is now exploring partnerships, including talks with a Chinese firm, to revive the facilities with experienced operators as equity partners.

This development underscores ongoing challenges in Nigeria’s energy sector, where reliance on imports persists despite vast crude reserves. Stakeholders are watching closely for the promised reassessment and potential reopening.