The Nigerian National Petroleum Company Limited (NNPC) has announced a major change in the way it will finance the country’s refineries. Instead of relying on loans backed by crude oil production, the company wants the Port Harcourt and Warri refineries to generate enough income to support their own operations.
Speaking at the Nigeria Oil and Gas Conference in Abuja, NNPC Group Chief Executive Officer, Bayo Ojulari, explained that the company is adopting a business-focused approach that rewards performance. According to him, future funding for the refineries will depend on how well they operate and how much value they create, rather than the amount of crude oil available.
Ojulari said the goal is to build refineries that can attract investors and secure financing based on their business performance. He stressed that this strategy will reduce dependence on government-backed loans and ensure the facilities remain sustainable for many years.
He also revealed that NNPC has reviewed its investment portfolio and removed projects that lacked clear funding plans or realistic profit potential. This move is part of the company’s wider effort to focus only on projects that can deliver long-term financial value.
As an example of its new direction, Ojulari highlighted the financing model used for the Ajaokuta-Kaduna-Kano (AKK) gas pipeline. Under the Project Nexus initiative, the pipeline is financed based on the income it is expected to generate through its operations rather than being supported by crude oil revenues. He said NNPC plans to apply a similar strategy to its refinery projects.
The company also believes that strong partnerships will be important to achieving its refinery goals. Ojulari said NNPC will continue working with experts in engineering, logistics, technology, marketing, and energy innovation to improve refinery operations and support Nigeria’s energy transition plans.
Recently, NNPC signed a Memorandum of Understanding with two Chinese companies—Sanjiang Chemical Company Limited and Xinganchen (Fuzhou) Industrial Park Operation and Management Company Ltd. The agreement is aimed at exploring a technical equity partnership for the Port Harcourt and Warri refineries.
If approved after detailed technical, financial, and legal reviews, the partnership could allow the Chinese investors to acquire a majority stake in the refineries. The companies would help complete engineering work, improve operations, expand production capacity, integrate petrochemical projects, and develop gas-based industries around the refinery sites.
Unlike the traditional contractor system, the proposed arrangement would involve long-term investment and shared management responsibilities. NNPC believes this model will improve efficiency and strengthen the commercial success of the refineries.
Despite doubts from some Nigerians about whether the country’s refineries can operate successfully again, Ojulari remains confident. He said the Port Harcourt, Warri, and Kaduna refineries can become profitable businesses capable of attracting investment, generating their own funding, and supporting Nigeria’s energy sector for the future.
