"Obasanjo Unveils Four Key Factors Hindering the Success of Nigeria's Refineries"

Former Nigerian President Olusegun Obasanjo has offered insights into why the country's four oil refineries, located in Warri, Port Harcourt, and Kaduna, have struggled to function effectively. According to a report by Leadership, Obasanjo expressed his views during an interview with TheCable on Tuesday, September 5. He revealed that Shell Petroleum Development Company had declined his proposal for them to manage the refineries, despite his persistent efforts to persuade them.

Obasanjo shared that during his tenure as president, he personally invited Shell to consider operating the refineries. To his surprise, Shell unequivocally rejected the offer. He recounted a conversation with the company's managing director at the time, where four key reasons were outlined for their refusal.

Firstly, Shell's primary source of revenue came from upstream operations, which aligned with their core interests. They engaged in downstream or retail activities primarily as a service. Secondly, the economic viability of the Nigerian refineries did not align with Shell's business strategy, as larger refineries were more attractive globally. Thirdly, the managing director cited concerns about widespread corruption within the refinery sector as a deterrent. These factors collectively contributed to Shell's decision not to engage in the operation of Nigeria's refineries.

While President Bola Tinubu had recently offered assurances that the Port Harcourt petroleum refinery would be operational by December 2023, Obasanjo's perspective underscores the challenges faced by these facilities as long as they remain under government control.