President of Dangote Group, Alhaji Aliko Dangote, says he doubts Nigeria’s state-owned refineries will ever work once more, regardless of gulping an estimated $18 billion in public funds.
Talking on Thursday, July 10, throughout a go to by members of the World CEO Africa from Lagos Enterprise School to his refinery in Lekki, Lagos, Dangote questioned the viability of rehabilitating the Port Harcourt, Warri, and Kaduna refineries managed by the Nigerian Nationwide Petroleum Firm Restricted.
He recalled a 2007 deal beneath former President Olusegun Obasanjo’s administration through which his consortium purchased the refineries, solely to return them months later beneath President Umaru Musa Yar’adua. Dangote stated the then-refinery chiefs informed Yar’adua that the amenities had been bought under worth.
“The refineries that we purchased earlier than, which have been owned by Nigeria, have been doing about 22 per cent of PMS. We purchased the refineries in January 2007. Then we needed to return them to the federal government as a result of there was a change of presidency,” Dangote stated.
“And the managing director at the moment satisfied Yar’adua that the refineries would work. They stated they only gave them to us as a parting present or so.
“And as of as we speak, they’ve spent about $18bn on these refineries, and they’re nonetheless not working. And I don’t suppose, and I doubt very a lot if they are going to work.”
Evaluating the continuing Turnaround Upkeep of the amenities to retrofitting a decades-old automobile, Dangote added:
“(The turnaround upkeep) is such as you attempting to modernise a automobile that was constructed 40 years in the past, when expertise and every part have modified. Even should you change the engine, the physique won’t be able to take the shock of that new expertise engine.”
His feedback reinforce these of former President Olusegun Obasanjo, who final yr criticised the NNPC’s capability to function the refineries, noting that even worldwide oil corporations like Shell had refused to tackle the accountability.
Obasanjo stated: “I ran to him (Yar’Adua), I stated, ‘You recognize this isn’t proper’. He stated, ‘Properly, NNPC stated they’ll do it.’ I stated, ‘NNPC can not do it,’ I informed my successor that ‘the refineries, from what I heard and know, is not going to work and if you need to promote them, you’ll not get anyone to purchase them at $200m as scrap’. And that’s the state of affairs we’re in.”
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He additional alleged that NNPC officers prioritised corrupt achieve over purposeful output.
“NNPC knew that they may not do it, however they knew they may eat and keep it up with the corruption that was happening in NNPC.
“When individuals have been there to do it, they put stress. In a civilised society, these individuals ought to be in jail,” Obasanjo stated.
In January, Obasanjo once more criticised the rehabilitation efforts. “I used to be informed not too way back that since that point, greater than $2bn have been squandered on the refineries and so they nonetheless is not going to work,” he stated.
Referencing Dangote’s personal refinery success, Obasanjo famous: “If anyone tells you now that it (the refinery) is working, why are they now with Aliko (Dangote)? And Aliko will make his refinery work; not solely make it work, he’ll make it ship.”
He concluded with a Yoruba proverb: “They are saying that after he has harvested 100 heaps of yams, he may also have 100 heaps of lies. You recognize what meaning.”
Current occasions seem to assist these views. The outdated Port Harcourt refinery was shut down once more six months after being declared operational.
Warri refinery additionally ceased operations one month after it was reopened. The Producers Affiliation of Nigeria and different trade voices have urged the Federal Authorities to privatise or scrap the amenities, branding them {economic} liabilities.
In 2021 alone, $1.4bn was accredited to rehabilitate the Port Harcourt refinery, $897m for Warri, and $586m for Kaduna.
In the identical yr, N100bn reportedly went into refinery rehabilitation at a month-to-month spend of N8.33bn.
Between 2013 and 2017, $396.33m was spent on Turnaround Upkeep. But, not one of the refineries are purposeful.
