Nigeria’s long-troubled 445,000-barrel-per-day state-owned refineries may be headed for a fresh start, as the Nigerian National Petroleum Company Limited has opened discussions with a Chinese petrochemical firm and other potential investors as part of a sweeping reset aimed at reviving the ailing assets.

But while state refineries struggle, the Dangote Petroleum Refinery, according to NNPC, has provided a crucial lifeline, giving NNPC breathing space to stabilise domestic fuel supply.

The reset of NNPC refineries is expected to involve the sale of equity in the plants to technically competent operators with proven capacity to run and sustain refinery operations, marking a departure from government-dominated control.

The Group Chief Executive Officer, Bayo Ojulari, disclosed the strategy on Wednesday in Abuja during a fireside chat titled “Securing Nigeria’s Energy Future” at the Nigeria International Energy Summit 2026. He offered rare insight into the commercial and operational realities confronting NNPC’s refining assets and outlined a board-approved strategy to end decades of losses.

Ojulari clarified that NNPC is not planning an outright sale but is prepared to relinquish as much equity as necessary to secure a sustainable operating model.

“So the current NNPC strategy, as approved by our board, is to focus on getting partners that have a track record of running refineries. We are not looking for contractors. We are not looking for Operations and Maintenance,” he said.

“We are looking for an entity that runs refineries. We are looking forward to them buying some of our shares. So, when you say sell, we will not say we are selling the refineries.

We will probably look at options where you can sell down some of our equity, so that they have a skin in the game. And with that, with the operational capacity, we will then cooperate with them. They lead the operation, and then we use that to develop, rebuild our own skills and support.”

The CEO stressed that the overriding goal is to establish a self-financing, sustainable refinery system. “For it to self-finance itself, for it to run like a business. We know that everywhere in the world, refinery margins are not very high. So there’s no way NNPC, the structure we have, can run a profitable refinery. We need to bring in additional capacity to complement what we have to run those refineries,” Ojulari said.

He confirmed that discussions with prospective investors have advanced, including a Chinese company that owns one of the largest petrochemical plants in China. “Incidentally, I’m just coming from a meeting with one of the potential investors, where we are looking at their plants. They are moving; they are going to the refinery tomorrow to inspect. And we also have a few other companies as well,” he revealed.

Nigeria’s four state-owned refineries—Port Harcourt (two plants), Warri, and Kaduna—have long operated far below capacity despite repeated rehabilitation efforts costing billions of dollars. Between 2015 and 2023, successive administrations approved multiple turnaround contracts, yet domestic refining output remained negligible, forcing Nigeria to rely heavily on fuel imports.

Ojulari acknowledged that the refineries became a pressure point upon his assumption of office, citing public anger over failed maintenance and wasted funds.

“Nigerians were angry. A lot of money had been spent, and expectations were very high. We were under extreme pressure,” he said, noting that an internal review revealed deep structural inefficiencies. “The first thing that became clear is that we were running at a monumental loss to Nigeria. We were just wasting money.”

He explained that monthly crude deliveries to the refineries only averaged 50 to 55 per cent utilisation, while operating and contractor costs continued to rise. “At Port Harcourt Refinery, for example, we were producing mid-grade products. When you compared the value of what came out to what went in, it was destruction of value,” Ojulari said.

The CEO noted that the decision to halt refinery operations, despite political pressure, was necessary to prevent further losses. “There were political pressures to keep them running, but if we continued, it would have been value destruction for the next 30 years,” he said.

Ojulari also cited long-standing issues with the financing model. “The financiers get paid. The EPC contractors get paid and leave. Then, NNPC is left to run the refinery for decades without the capacity. O&M contracts only made it worse. Everyone was taking money from the system without any skin in the game,” he explained.

Amid the challenges faced by state-owned refineries, Ojulari praised the Dangote Petroleum Refinery for its stabilising role. “Thank God for Dangote Refinery. Thank God. Whether you love Dangote, you hate him, say whatever you want to say, Nigerians should thank God for Dangote,” he said, drawing applause from the audience.

The CEO noted that the 650,000-barrel-per-day refinery’s local ownership was significant for national energy security. “Thank God he’s a Nigerian. He’s not someone from another continent or another planet. Despite everything, that gave us an opportunity because we have a refinery that is working,” Ojulari said.

While acknowledging that Dangote Refinery does not meet full domestic fuel demand, Ojulari said its operations significantly reduced vulnerability in the supply chain. “Yes, it may not meet our full needs, but it gives us a breathing space. And luckily, we are shareholders in that refinery as well,” he added.

Ojulari’s remarks signal a pragmatic shift in NNPC’s approach to Dangote Group, moving from confrontation to collaboration. “We said, what’s the hurry? We have a refinery that is working. It’s not owned by NNPC, but it’s a Nigerian refinery, built in Nigeria, working in Nigeria,” he said.

He revealed that NNPC has engaged directly with Dangote to chart a framework for cooperation aligned with the Petroleum Industry Act. “Our strategy is to collaborate with the Dangote Refinery and maximise the value delivered to Nigerians. We had a meeting with Alhaji Dangote, explained our institutional responsibilities, and we agreed on the pathway towards deeper collaboration while maintaining our role as NNPC,” Ojulari said.

The CEO also expressed optimism for oil production, projecting Nigeria could achieve 1.8 million barrels per day in 2026, although he described the 2025 budget benchmark of 2.06 million barrels per day as overambitious.

Ojulari’s candid comments mark one of the clearest acknowledgements by an NNPC chief executive that continued state refinery operations, under current conditions, are economically unjustifiable, underscoring the company’s pivot toward commercial discipline and collaboration with private operators.