Why Yar’Adua rejected Dangote’s $750m offer to manage Kaduna, Port Harcourt refineries – Obasanjo

Former President Olusegun Obasanjo has revealed that his successor, Umaru Musa Yar’Adua, rejected a $750 million offer from Aliko Dangote, Chairman of Dangote Group, to manage the Port Harcourt and Kaduna refineries in 2007 because the Nigeria National Petroleum Corporation (NNPC) said they could manage it.

Obasanjo spoke in an interview with Channels Television, on Thursday, where he highlighted the challenges faced with Port Harcourt, Warri, and Kaduna refineries during his presidency.

The ex-president said the NNPC Limited was aware of its limitations in managing the nation’s refineries but still informed Yar’Adua it was capable of managing the refineries.

He also said he sought external help to rehabilitate and manage the facilities but faced resistance.

“When I was president, I wanted to do something about the three refineries we have: Port Harcourt, Warri, and Kaduna. Aliko got a team together after I asked Shell to come and run it for us. And Shell said they wouldn’t,” Obasanjo said.

“Later on, I called them. I called the boss of Shell to come and tell me what the problem was and he gave me four or five reasons.

“He (Shell boss)  said, first of all, they make a major profit from upstream, not from downstream. He said they run downstream just to keep their head above water.

“Two, our refineries were too small: 60,000 barrels, 100,000 barrels and I think 120,000 barrels. He said that at that time, the average refinery was going for 250,000 barrels.

“Three, he said our refineries were not well maintained. Four, he said that there was too much corruption around the activities of our refinery and they would not want to get involved in that.

“After that, Aliko got a team together and they paid $750m to take part in PPP (Public–Private Partnership) in running the refineries.

“My successor refunded their money and I went to my successor and told him what transpired.

“He said NNPC said they wanted the refineries and they could run it. I now said but you know they cannot run it.”

The former president also said he is confident in Dangote’s ability to manage his privately owned refinery effectively, contrasting it with the government’s inefficiency.

Obasanjo also expressed frustration over the mismanagement of the refineries, adding that despite the amount spent on them since 2007 no results have been made.

“I was told not too long ago that since that time, more than $2 billion have been squandered on the refinery and they still will not work,” he said.

“If a company like Shell tells me what they told me, I will believe them. But here we are, over $2 billion squandered, and the refineries still won’t work.”

On December 31, 2024, Mele Kyari, the group chief executive officer (GCEO) of the NNPC, said the Warri Refining & Petrochemicals Company (WRPC) in Delta state was now operational.

On November 26, the NNPC said the Port Harcourt refinery had officially commenced crude oil processing.