Energy expert urges FG to divest from its four refineries

Energy expert Dan Kunjle has issued a strong call for the Nigerian federal government to divest from its four state-owned refineries, arguing they are a significant drain on public resources.

In an open letter to President Bola Tinubu, Kunjle labeled the Port Harcourt Refineries I and II, Warri Refinery, and Kaduna Refinery as "four diseased fingers." He asserted that these facilities have consumed vast sums for decades without consistently delivering refining capacity. Kunjle contends that the continued investment in these refineries diverts essential funds that could be allocated to crucial areas like healthcare, education, infrastructure, security, and electricity.

Kunjle pointed to the privatization of the Eleme Petrochemicals complex under former President Olusegun Obasanjo as a successful precedent. He believes that government divestment can lead to enhanced efficiency, attract much-needed investment, and stimulate job creation. The expert urged President Tinubu to initiate a transparent and competitive privatization process for the refineries, to be completed within a year, involving full disclosure of bidders, valuations, and investment commitments.

He also cautioned against any non-transparent asset transfer arrangements, such as technical partnerships or memorandums of understanding, warning they could lead to legal challenges and damage investor confidence. Kunjle advocated for privatization, concessioning, or liquidation where economically viable, allowing the NNPCL to concentrate on upstream operations and ending decades of inefficiency. His intervention follows recent investigations by the Economic and Financial Crimes Commission into alleged diversion of funds meant for refinery rehabilitation.

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The time for endless rehabilitation has passed. The time for decisive reform has arrived. Mr President, this is a legacy decision. Privatise them transparently. Concession them transparently where appropriate. Liquidate those that can no longer be economically justified. Above all, let the law, openness and the national interest guide every decision. The Chinese are welcome to compete. Nigerian investors are welcome to compete.