Fresh controversy has emerged over the recent Memoranda of Understanding (MoUs) signed by the Nigerian National Petroleum Company Limited (NNPC) with two Chinese firms for the rehabilitation and operation of the Warri and Port Harcourt refineries. The development has triggered renewed calls for the federal government to consider indigenous energy companies with proven records in the oil and gas sector.
NNPC recently disclosed that it entered into partnership discussions with Sanjiang Chemical Company Limited and Xinganchen Industrial Park Operation and Management Company Limited as part of efforts to complete refinery rehabilitation projects, improve operations, expand refining capacity and develop petrochemical and gas-based industrial hubs around the facilities.
However, the agreement has drawn criticism from several stakeholders within the industry, with concerns raised about the technical and financial capabilities of the Chinese firms involved. Former President of the Organised Private Sector of Nigeria (OPSN), Dele Oye, questioned the firms’ qualifications, insisting they lack experience in refinery rehabilitation and operations when compared with global engineering companies previously contracted for similar projects in Nigeria.
Industry observers also argued that Nigerian oil and gas companies now possess stronger technical and financial capacity than in previous years. Firms such as Seplat Energy, First E&P, Conoil Producing and Renaissance Africa Energy Holdings were cited as examples of indigenous operators successfully managing complex upstream and infrastructure projects.
Experts suggested that the government could have explored a consortium model that combines local investors and operators with experienced engineering contractors, similar to the structure used in the development of the Dangote Refinery.
The debate comes amid lingering concerns over billions of dollars previously approved for refinery rehabilitation projects under past administrations. Despite multiple announcements of progress and operational restarts, the Port Harcourt, Warri and Kaduna refineries have continued to experience shutdowns and operational setbacks.
Reports that the Economic and Financial Crimes Commission (EFCC) is investigating aspects of earlier refinery rehabilitation contracts have also intensified public scrutiny of the projects.
Responding to the criticism, NNPC maintained that the discussions with the Chinese firms are aimed at securing sustainable technical and commercial solutions for the country’s refining sector. The company added that any final agreement would still be subject to negotiations and regulatory approvals.
Meanwhile, energy experts and transparency groups have continued to oppose the new agreements, warning that Nigeria risks repeating costly mistakes if proper accountability and due diligence are not carried out before moving forward with the refinery partnerships.
