• Government imposes 15% fuel import tax to protect local refining

• Shift to equity model after $25B failed refurbishment efforts

The head of the Nigerian National Petroleum Company (NNPC), Bayo Ojulari, said on Wednesday that the state oil firm has launched a technical and commercial review of Nigeria’s three state-owned refineries, Port Harcourt, Warri, and Kaduna, with a combined capacity of 445,000 barrels per day (bpd).

The goal is to attract technical and financial partners to restart the plants after years of inactivity.

Ojulari said NNPC plans to select partners with proven experience in running refineries to international standards and to conclude investment deals aimed at rehabilitating or converting the facilities.

New Tax to Boost Local Refining

The move comes as the government introduced a 15% tax on imported fuel to “protect local refining capacity and stabilize the downstream market.”

 A document cited by ThisDay newspaper said the measure could raise pump prices by up to 150 naira per liter, although the government insists the net impact will not exceed 100 naira.

Two years ago, Parliament revealed that more than $25 billion had been spent over the previous decade trying to refurbish the refineries. Yet only a few units at Port Harcourt have briefly come online before shutting down again. The Warri refinery has yet to resume operations, while the Kaduna plant remains idle.

Billionaire Aliko Dangote, who owns the country’s largest refinery, has previously criticized these efforts, comparing them to trying to modernize a car built 40 years ago.

NNPC Shifts to Equity Partnerships

After repeated failures, NNPC is now moving to an equity partnership model, allowing foreign investors to take stakes in the refineries in exchange for technical and operational responsibility.

Despite being Africa’s top crude oil producer, Nigeria imports most of its refined fuel, leaving it vulnerable to international price swings and persistent domestic fuel shortages. Reviving the public refineries, alongside the 650,000 bpd Dangote refinery, is a key priority for the Tinubu administration, which aims to boost energy security and cut the costly fuel subsidy bill.

If the partnerships succeed, Nigeria could end fuel imports and eventually export refined products, though the short-term impact of the import tax could add to inflationary pressures and spark social unrest in a country already struggling with a rising cost of living.

Olivier de Souza