Why Shell refused to run Nigeria’s refineries – Obasanjo

Former President Olusegun Obasanjo said he offered Nigeria’s refineries to Shell to run but the company turned it down for four reasons.

In an interview with Channels TV on Thursday, Obasanjo said Shell refused to run Port Harcourt, Warri, and Kaduna refineries during his presidency for many reasons, one of which was because of corruption.
“I asked Shell to run the refineries for us and Shell said they wouldn’t. I asked them to take equity but they said no.

“Later on, I called the boss of Shell to come and tell me what the problem was and he gave me four or five reasons. He said, first of all, they make a major profit from upstream, not from downstream. He said they run downstream just to keep their head above water.

“Two, he said our refineries were too small: 60,000 barrels 100,000 barrels and I think 120,000 barrels. He said that at that time, the average refinery was going for 250,000 barrels.

“Three, he said our refineries were not well maintained. Four, he said that there was too much corruption around the activities of our refinery and they would not want to get involved in that.”

Obasanjo said after Shell’s refusal, Aliko Dangote, Africa’s richest man, put a team together and paid $750 million to operate the refineries through a public-private partnership.

“Aliko got a team together and they paid $750m to take part in public–private partnership (PPP) in running the refineries. My successor refunded their money and I went to my successor and told him what transpired. He said NNPC said they wanted the refinery and they could run it and I said but you know they cannot run it,” he narrated.

Obasanjo said he was told not too long ago that since that time, more than N2 billion dollars has been squandered on the refinery and they still would not work.

“If a company like Shell tells me what they told me, I will believe them. If anybody tells you now that it is working, why are they now with Aliko? And Aliko will make his own refinery work; not only make it work, he will make it deliver.”