Nigeria to sell controlling stake in its four oil refineries –NNPC

Nigeria will sell its majority shareholding and forfeit its
controlling stake in all its four comatose oil refineries if the
ongoing negotiation talks succeed, the Group Managing Director of the
Nigerian National Petroleum Corporation (NNPC), Mele Kyari said on
Wednesday.

The NNPC head told Channels TV that talks were progressing on an
operating model, which would make the corporation or the Nigerian
government become a minority shareholder in the assets.

This is coming days government declared it would no longer fix the
pump price of petrol and said it had completely removed fuel subsidy,
which is said to cost Nigeria well over a trillion every year, more
than the country’s annual budget for education and health.

“It means there will be more scrutiny of shareholders and also
becoming more efficient to operate. That conversation is on the
table,” Kyari said, not mentioning how the Nigerian government planned
to transfer ownership.

The loss-making refineries have worked only intermittently for years
due to acute underinvestment and highly dilapidated machinery, making
Africa’s biggest exporter the only member nation of the Organisation
of the Petroleum Exporting Countries (OPEC) that imports petroleum
products.

In the past 13 years, government has made at least five attempts to
crank up the refineries with the combined capacity to refine 445,000
barrels of crude per day to no avail.

The NNPC last month asked private investors to bid to fix pipelines
and depots serving the refineries, which had been target of theft and
vandalism for years.

The state-owned firm announced in April it had shut the refineries
down to obtain funding for their rehabilitation and would no longer
manage them when they recommenced operation.

In the 13 months to 30th June, the refineries processed almost no
crude even though they incurred consolidated losses of N142.1 billion
($367 million).