Despite public assurances from the government on reviving state-owned refineries, only the Dangote Refinery is actively producing Premium Motor Spirit (PMS), commonly known as petrol, according to economist and energy sector analyst, Kelvin Emmanuel.
Speaking on Channels Television’s Morning Brief on Monday, Emmanuel asserted that all government-owned refineries remain either dormant or limited to blending operations, falling short of genuine refining capabilities.
“I’ve always said it, and I stand by it: the only refinery in Nigeria producing PMS is Dangote,” he declared. “Dangote is doing 44 million liters of PMS on a daily basis. In contrast, NNPC is not refining PMS – they are only blending.”
Refineries Largely Non-Functional
According to Emmanuel, key units required to refine PMS are either defective or non-operational in state-run facilities such as Warri, Port Harcourt, and Kaduna. While Warri Refinery has a catalytic reforming unit essential for converting naphtha into PMS, Emmanuel noted the unit is non-functional.
“So you can’t actually refine PMS. You can produce naphtha, but you can’t break it into higher distillates like PMS,” he explained. “The same thing applies in Port Harcourt.”
Data from the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), he added, supports the claim that the refineries are not producing PMS. Instead, he said, NNPC and its subsidiaries are engaging in crude blending: combining imported condensates like C5 raciness with naphtha to simulate petrol.
Dangote Refinery Filling the Gap
The privately owned Dangote Refinery—Africa’s largest—has stepped in to meet a significant portion of Nigeria’s petrol demand. Operational since 2024, the refinery reportedly processes 44 million liters of PMS daily and has already exported refined products like jet fuel to global oil giants including Saudi Aramco.
Despite initial hurdles, including a failure by NNPC Limited to meet local crude supply commitments, the refinery has begun importing crude from abroad to maintain operations.
In November 2024, Dangote Group President Aliko Dangote called for greater cooperation between his refinery and others in the country to meet Nigeria’s growing domestic demand for refined petroleum products.
Modular Refineries: Limited Impact
Emmanuel also noted the presence of modular refineries like Arabel, Walter Smith, DuPont Mainstream, and OPAC. However, he emphasized that their limited capacities—ranging from 1,000 to 11,000 barrels per day—are insufficient to meet national fuel demands or significantly shift the supply dynamics.
Lacking a Hydrocarbon Accounting Framework
Beyond refining challenges, Emmanuel criticized the federal government’s inability to implement a comprehensive hydrocarbon accounting system. He warned that the absence of real-time data on crude production and allocations is leading to revenue losses and misreporting.
“Nigeria is one of the few crude oil-producing countries in the world without a hydrocarbon accounting framework,” he said. “Section 69 of the Petroleum Industry Act (PIA) mandates a GIS-based grid system with metering at every critical point—from wellheads to transmission pipelines.”
The lack of such a framework, he argued, hampers transparency and leaves room for manipulation in both upstream production and downstream allocation.
Misplaced Investments in Turnaround Maintenance
Emmanuel further questioned past investments in so-called “turnaround maintenance” for state refineries, particularly the controversial $450 million advanced to a licensed operator via NNPC. He argued that the sum approved by the Federal Executive Council (FEC) in 2021 could have built an entirely new refinery with modern capacity.
“Instead of investing in outdated infrastructure, the funds could have been used to build a modern facility capable of meeting today’s refining standards,” he said.
Looking Ahead
As the Dangote Refinery gains momentum and modular refineries offer incremental support, questions continue to swirl around the future of Nigeria’s state-owned refining assets. Stakeholders increasingly point to the need for a strategic shift—from sustaining old, inefficient systems to supporting private-led industrial capacity backed by regulatory clarity and operational transparency.