Nigerian refineries are the backbone of the country’s crude oil production industry. However, these refineries have been more of a burden than a blessing, as they have been plagued by years of mismanagement and neglect leading to a loss of billions of naira. On Tuesday, the House of Representatives’ Committee on Petroleum Resources (Upstream) disclosed that the federal government spent N11.35tn on the refineries for the past 13 years without achieving much.
According to the Chairman of the committee, Musa Sarki Adar, the government-owned refineries were barely functioning, noting that the Turn Around Maintenance (TAM) carried out by successive administrations failed to salvage them. The committee chairman disclosed this during an investigative hearing on the need to resuscitate the refineries.
Adar further stated that the TAM, which was supposed to be carried out every two years, should not cost more than $50m, but in Nigeria, it had become an avenue for corruption and a conduit pipe to siphon public funds. He also said the refineries’ continued operation in their current state would pose a threat to lives and the environment.
The committee then called on the Nigerian National Petroleum Corporation (NNPC) and other stakeholders to review the entire maintenance strategy of the refineries to ensure their optimum productivity. The lawmakers also urged the NNPC to ensure transparency in awarding contracts for the TAM of the refinery.
It is noteworthy that the refineries have witnessed more than 28 TAM exercises since they were first commissioned in 1980 but remain moribund. The Nigerian government privatized them, selling them to new owners, but it eventually bought them back, citing inadequate funds by the owners for their operations.
In conclusion, the committee posited that the only viable option left is to privatize the refineries. This is to ensure that they are efficiently managed by competent private entities and be profitable, and be a source of revenue generation for the government.
