Nigeria Turns to Chinese Firms to Fix Loss-Making Refineries Shut for Years

Nigerian National Petroleum Company (NNPC) has signed a memorandum of understanding with two Chinese firms as it seeks to restart and expand the long-idle Port Harcourt and Warri refineries, which have been shut for years and have historically weighed on public finances.

NNPC said in a statement on Monday that the MoU was signed in Jiaxing City, China, on April 30 by its Group CEO, Bashir Bayo Ojulari, alongside Sanjiang Chemical Company Limited chairman Guan Jianzhong and Xinganchen (Fuzhou) Industrial Park Operation and Management Co. Ltd chairman Bill Bi.

Under the framework, the parties will pursue a potential “technical equity partnership” aimed at completing outstanding work at the two refineries and then operating and maintaining them to deliver “best-in-class, sustainable performance,” NNPC said. The plans also include upgrades and expansion intended to move the plants toward cleaner fuel specifications and improved profitability.

NNPC added that talks would also cover expanding petrochemical capacity and developing co-located, gas-based industrial hubs to capture downstream and gas opportunities.

Ojulari said the MoU marked a milestone after more than six months of engagement between NNPC and the prospective partners, adding that the parties see “mutually beneficial opportunities” to make Nigeria’s refining assets sustainably profitable.

NNPC stressed the MoU reflects an intent to continue discussions in good faith, with any final agreements to come later and subject to regulatory and other customary approvals.