The Nigerian National Petroleum Company (NNPC) Limited is in advanced talks with China’s state-owned Sinopec to revive its underperforming refineries in Port Harcourt and Warri.
Under a newly minted “equity partnership” model, Sinopec—or its subsidiary China Refinery and Petrochemical Company (CRPC)—would not only fund the restarts but also lead the day-to-day operations of the plants.
This move, spearheaded by NNPC’s Group CEO Bashir Bayo Ojulari, marks a departure from the “contractor-led” models of the past. By offering an equity stake, NNPC aims to ensure its partners have “skin in the game,” shifting the burden of operational excellence to the Chinese giant while NNPC retains a non-operating minority interest.
The Bayo Ojulari Doctrine
Since taking the helm in April 2025, Ojulari has been vocal about the “value leakage” within NNPC’s refining division:
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The “Waste” Admission: At the 2026 Nigeria International Energy Summit, Ojulari admitted that past efforts to run the refineries resulted in “monumental losses,” as output value often failed to even cover the cost of the crude oil supplied.
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Operational Shutdown: NNPC recently made the tough call to shut down the state-owned plants for a “Technical and Commercial Review” after finding that capacity utilization had stalled at a mere 50–55% despite billions spent on maintenance.
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Hybrid Vision: NNPC is considering redesigning its refineries into “hybrid plants” to meet Euro-V international standards, ensuring they can compete with the high-quality output of the Dangote Refinery.
Partnership Mechanics: The “Chinese Preferred” Model
Negotiations with the Chinese partners currently revolve around two potential pathways:
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Collocation in Warri: The Chinese partners reportedly prefer a “collocation” strategy, which involves importing a modern refinery from China and installing it alongside the existing 120,000 bpd Warri site.
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Port Harcourt Refurbishment: The alternative is a full-scale refurbishment of the 210,000 bpd Port Harcourt Refinery, estimated to cost approximately $2.5 billion.
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Deadline: Ojulari has set June 2026 as the target date to finalize these partnership agreements.
The Political Backdrop: Privatization vs. Partnership
The Sinopec deal has reignited the national debate over the fate of Nigeria’s energy assets:
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The Atiku Critique: Former Vice President Atiku Abubakar has called for the deal to be discontinued, arguing that “pouring public funds into moribund refineries is economically indefensible” and advocating for outright privatization.
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Market Competition: NNPC maintains that it must stay in the refining game to ensure energy security and prevent a “private monopoly” from dominating the domestic fuel market.
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