Ex-NNPC GMDs Visit PH Refinery, Say Public Criticisms Misguided 

•Dangote Refinery says it was never desperate for FX

Emmanuel Addeh in Abuja

Former Group Managing Directors of the Nigerian National Petroleum Company Limited (NNPC) have visited the Port Harcourt refinery, with a verdict that the recent criticisms of the facility which recently recommenced operations were misguided.

The former top NNPC officials under their forum of former GMDs commended the efforts of the current management team led by Mr. Mele Kyari after inspecting the refinery,  describing the work done so far as  ‘magic.’

Speaking on behalf of the group, Dr. Jackson Gaius-Obaseki, who served as GMD from 1999 to 2003, explained that many critics fail to understand the magnitude of work involved in revamping a facility of that complexity.

He clarified that it was not a routine Turnaround Maintenance (TAM), but a full rehabilitation that modernised a plant originally built in 1965 into what he described as a ‘state-of-the-art’ facility by 2024.

“Some of those who criticise do not understand the extent of the work carried out. They mistake it for the usual turnaround maintenance. This is a complete rehabilitation—transforming a plant built in 1965 into a modern one in 2024. We appreciate the effort,”  Gaius-Obaseki was quoted as  saying.

On petroleum pricing, Gaius-Obaseki emphasised that petrol pump prices are influenced by crude oil prices and called for public understanding. He hailed the achievement as a testament to courage and dedication, urging Kyari to remain focused on delivering value to Nigerians.

Other former GMDs present at the meeting included Chamberlain Oyibo, FunshoKupolokun, and Andrew Yakubu, who were said to have collectively lauded the success of the project.

Meanwhile, the Dangote refinery yesterday said that at no time was it desperate for foreign exchange during the construction and commissioning of the 650,000 barrels per day facility, in response to a recent comment by the national oil company.

It said it had  received numerous inquiries from the media and other concerned stakeholders seeking clarification on a recent report attributed to the NNPC that their decision to secure a $1 billion loan backed by its crude was instrumental in supporting the Dangote refinery during liquidity challenges.

“We would like to clarify that this is a misrepresentation of the situation as $1 billion  is just about 5 per cent of the investment that went into building the DangoteRefinery. Our decision to enter into a partnership with NNPC was based on recognition of their strategic position in the industry as the largest offtaker of Nigerian crude and at the time, the sole supplier of gasoline into Nigeria.

“We agreed on the sale of a 20 per cent stake at a value of $2.76 billion. Of this, we agreed that they will only pay $1 billion while the balance will be recovered over a period of five years through deductions on crude oil that they supply to us and from dividends due to them. If we were struggling with liquidity challenges we wouldn’t have given them such generous payment terms. 

“As at 2021 when the agreement was signed, the refinery was at the pre-commission stage. In addition, if we were struggling with liquidity issue, this agreement would have been cash based rather than credit driven,” the refinery said in a statement by its Group Chief Branding and Communications Officer, Anthony Chiejina.

However, the Dangote refinery said the NNPC was later unable to supply the agreed 300, 000 barrels a day of crude given that they had committed a greater part of their crude cargoes to financiers with the expectation of higher production which they were unable to achieve.

“We subsequently gave them a 12-month period for them to pay cash for the balance of their equity given their inability to supply the agreed crude oil volume. NNPC failed to meet this deadline which expired on June 30, 2024. As a result, their equity share was revised down to 7.24 per cent . These events have been widely reported by both parties.

“It is, therefore, inaccurate to claim that NNPC facilitated a $1 billion investment amid liquidity challenges. Like all business partners, NNPC invested $1 billion in the Refinery to acquire an ownership stake of 7.24 per cent stake that is beneficial to its interests.

“NNPC remains our valued partner in progress, and it is imperative for all stakeholders to adhere to the facts and present the narrative in the correct context, to guide the media in reporting accurately for the benefit of our stakeholders and the public,” the statement added.