Abuja, Nigeria — November 5, 2025 | SOFO.ng News Desk
Nigeria’s Federal Government is weighing a major policy shift that could reshape the country’s oil and gas industry — the sale or partial privatization of its state-owned refineries — as part of efforts to attract private investors and create competition in a market increasingly dominated by the Dangote Refinery.
Officials familiar with the ongoing discussions say the move aims to reposition the nation’s refining assets in Port Harcourt, Warri, and Kaduna as viable investment opportunities, while easing the government’s financial burden from years of costly but underperforming rehabilitation projects.
Privatization on the Table
The Nigerian National Petroleum Company Limited (NNPC) recently hinted that divesting government stakes in these refineries is under consideration, given the persistent challenges in restoring them to optimal performance.
Despite billions spent on repairs and turnaround maintenance, the facilities have remained largely idle, forcing Nigeria to depend heavily on fuel imports — a situation the government now seeks to correct through private-sector-led participation.
Labour unions, including the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN), have echoed similar calls, urging the Federal Government to sell majority stakes to credible investors who can inject capital, technology, and efficiency into the refining sector.
A Subtle Challenge to Dangote’s Dominance
The government’s move is seen by industry observers as a strategic counterbalance to Dangote Group’s growing market influence, following the launch of the $20 billion Dangote Refinery, which now dominates Nigeria’s refining landscape with a processing capacity of over 650,000 barrels per day.
While the Dangote Refinery promises to meet domestic fuel demand and drive exports, stakeholders fear it could also create a monopoly effect — concentrating too much power in one private entity’s hands.
“The government wants a diversified downstream sector,” said an Abuja-based energy analyst. “Selling the old refineries to credible investors could inject new competition and stabilize pricing long-term.”
Investment and Real Estate Implications
Beyond energy supply, the potential sale of these refineries opens a new chapter for industrial land and infrastructure investment. Each of the facilities — particularly those in Warri and Port Harcourt — sits on massive tracts of strategically located land, offering potential for logistics hubs, tank farms, modular refineries, and industrial estate redevelopment.
Experts believe that once privatized, these assets could attract billions in foreign direct investment (FDI) and spur regional real estate growth, particularly in host communities that have long suffered from unemployment and poor infrastructure.
Balancing Efficiency and Public Interest
However, critics caution against hasty sales, warning that privatization without transparency could lead to asset stripping or new forms of monopoly.
Energy policy expert Dr. Tunde Akinola urged the government to design a “competitive but transparent bidding process” to ensure that only investors with technical and financial capacity acquire the assets.
“The focus shouldn’t just be to sell,” Akinola said. “It should be to reform — to bring efficiency, jobs, and fair pricing. Otherwise, we may simply replace one monopoly with another.”
What Happens Next
The Ministry of Petroleum Resources is expected to submit a policy recommendation to the Federal Executive Council before the end of Q1 2026, outlining the framework for refinery divestment, including investor selection criteria and timelines.
If approved, the sale could mark Nigeria’s most significant energy sector reform since the enactment of the Petroleum Industry Act (PIA) in 2021.
As the government seeks to balance economic liberalization with public interest, the outcome of this decision could redefine not only Nigeria’s refining future — but also its broader industrial and real estate landscape.