The Group Chief Executive Officer of the Nigerian National Petroleum Company Limited (NNPCL), Bayo Ojulari, has revealed that the state-owned refineries were operated at a “Monumental loss” which led to the decision to stop operations in a bid to resist further value erosion.

Ojulari spoke on Wednesday in Abuja during a fireside chat titled “Securing Nigeria’s Energy Future” at the Nigeria International Energy Summit 2026.

Speaking extensively on the commercial and operational realities confronting NNPC’s refining assets, the NNPCL boss said public anger over the refineries was valid and justified, due to the scale of public funds expended over the years and the high expectations placed on the facilities.

According to him, upon assuming office, refining was not his core area of expertise, having spent most of his career in the upstream sector, but he said accountability demanded rapid learning.

“On the refineries, Nigerians were angry. A lot of money has been spent, and expectations were very high. So we were under extreme pressure, extreme pressure.

“My background is upstream, so I was on a vertical learning curve. You are accountable, so you must learn very quickly. Otherwise, there is no escape.

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“The first thing that became clear, and I want to say this very clearly, is that we were running at a monumental loss to Nigeria. We were just wasting money. I can say that confidently now,” he said.

Ojulari stressed that once his management team began a detailed review of refinery operations, the financial reality became immediately clear.

He revealed that NNPC was consistently pumping crude cargoes into the refineries each month, yet utilisation levels hovered around 50-55 per cent, resulting in significant value leakage.

“We were spending a lot of money on operations, a lot of money on contractors. But when you look at the net, we were just leaking away value,” Ojulari said.

Ojulari described the absence of any credible plan to turn the tide around.

“Sometimes you make a loss during investment, but you have a line of sight to recovery. That line of sight was not clear here,” he added.

To this end, Ojulari said the first major decision of his administration was to halt refinery operations to prevent further losses and allow for a rapid reassessment.

“We decided to stop the refinery and do a quick check. We planned that if things were lined up, we would reopen and work on them,” he said.

He disclosed that part of the value destruction stemmed from the quality of products being produced, citing the Port Harcourt Refinery as an example.

“The crude we were taking into Port Harcourt was producing mid-grade products. When you aggregate their value compared to what you put in, it was a waste,” he said.

He affirmed that the decision to pause operations was politically sensitive, noting that NNPC had historically been pressured to keep refineries running to ensure fuel supply continuity.

“There were political pressures to keep the refinery product, lots of pressure. But when you have been trained for over 35 years to focus on commerciality and profitability, you can’t sleep with that,” he said.

Nigeria’s four state-owned refineries, Port Harcourt (two plants), Warri, and Kaduna, have for decades operated far below capacity despite repeated turnaround maintenance exercises costing billions of dollars.

At various points, the plants have operated at single-digit capacity or been shut down entirely, forcing Africa’s largest oil producer to rely almost entirely on fuel imports.

Between 2015 and 2023 alone, successive administrations approved multiple rehabilitation contracts, yet domestic refining output remained negligible, intensifying public scrutiny of NNPC’s operational efficiency.