The President of the Dangote Group, Alhaji Aliko Dangote, has said that Nigeria’s state-owned refineries located in Port Harcourt, Warri, and Kaduna may never function properly again, despite about $18 billion reportedly invested in their rehabilitation.
Alhaji Dangote made the remark while hosting members of Global CEO Africa, who visited the Dangote Petroleum Refinery on Wednesday.
He said the 650,000-barrel-per-day (bpd) refinery was constructed after the government of the late President Umar Musa Yar’Adua declined to sell the refineries to him.
He stated, “The refineries we bought before, which were owned by Nigeria, were producing about 22 percent of PMS. We bought the refineries in January 2007. Then we had to return them to the government because there was a change of administration.
“The managing director at that time convinced President Yar’Adua that the refineries would work. They claimed the assets were given to us as a parting gift or something of that sort. As of today, they have spent about $18 billion on those refineries, and they are still not working. I don’t think, and I seriously doubt, that they ever will.”
Speaking further on the inefficiency of the rehabilitation efforts, he said, “(The turnaround maintenance) is like trying to modernise a car built 40 years ago, when technology and everything else has changed. Even if you replace the engine, the body won’t be able to withstand the shock of that new technology.”
It will be recalled that former President Olusegun Obasanjo had made similar remarks last year, noting that the Nigerian National Petroleum Company (NNPC) was fully aware that it could not manage the refineries effectively.
He revealed that some investors, including Aliko Dangote, paid $750 million to acquire the refineries; however, his successor, President Yar’Adua, aborted the transaction.
Obasanjo stated, “I ran to him (Yar’Adua), and I said, ‘You know this is not right.’ He said, ‘Well, NNPC said they can do it.’ I said, ‘NNPC cannot do it.’ I told my successor, ‘From what I’ve heard and know, these refineries will not work, and when you want to sell them, you won’t even get $200 million for them as scrap.’ And that is the situation we are in.”
He added, “So why do we keep doing this kind of thing to ourselves? NNPC knew it couldn’t do it, but it also knew it could continue to siphon funds amid the corruption. When people were ready to make it work, pressure was mounted to abort the process. In a civilised society, those responsible should be in jail.”
Earlier this year, Obasanjo also stated, “I was told not too long ago that since then, more than $2 billion has been squandered on the refineries, and they still do not work.
“If a company like Shell tells me what they told me, I will believe them. If anyone tells you now that the refineries are working, then why are we turning to Aliko (Dangote)? Aliko will make his refinery work; not only will he make it work, but he will also make it deliver.”