ABUJA, Nigeria (VOICE OF NAIJA)-The Petroleum Products Retail Outlets Owners Association of Nigeria has called on authorities to provide a full breakdown of an estimated N11.35tn allegedly spent on the rehabilitation of government-owned refineries, warning that a lack of transparency continues to erode trust in the petroleum industry and deepen Nigeria’s energy insecurity.
In its assessment of the petroleum sector’s performance in 2025 and outlook for 2026, jointly signed by its National President, Billy Gillis-Harry, and spokesman, Joseph Obele, PETROAN noted that despite sustained public expenditure on refinery rehabilitation over several years, the facilities remain largely idle or underperforming.
The association stated, “Over the past decade, massive public funds, reportedly around N11.35tn, have been expended on turnaround maintenance and rehabilitation of the four government-owned refineries (Port Harcourt, Warri, and Kaduna), yet the facilities largely remain non-functional or underperforming.”
PETROAN stressed the need for openness and accountability, saying, “Transparent tracking of funds borrowed and spent must be prioritised. Full forensic audits are essential to restore confidence in public investments. Clear accountability frameworks must be enforced to prevent further waste of public resources.”
It further disclosed that approved contracts covered “Port Harcourt Refinery: $1.5bn, and “Warri & Kaduna Refineries: Combined $1.48bn,” adding that the magnitude of the spending had raised serious concerns within the downstream sector.
According to the association, “These significant outlays, coupled with the enduring non-operational status of the refineries, have prompted investigations by security agencies and legislative oversight bodies into allegations of fraud, mismanagement, and lack of accountability.”
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PETROAN reiterated the urgency of transparency, emphasising that “Transparent tracking of funds borrowed and spent must be prioritised.” It added that “Full forensic audits are essential to restore confidence in public investments,” while maintaining that “Clear accountability frameworks must be enforced to prevent further waste of public resources.”
The association linked the failure of the refineries to wider downstream sector difficulties experienced in 2025, including supply shortages and a growing dependence on imported petroleum products.
It recalled that the Port Harcourt Refinery, Nigeria’s largest state-owned refining complex, “was shut down on May 24, 2025, after a short period of production, following persistent operational challenges, mechanical failures, and the inability to sustain stable commercial production after rehabilitation efforts.”
PETROAN warned that the prolonged shutdown has continued to limit domestic refining capacity, heightening reliance on imports and placing additional pressure on foreign exchange demand and pump prices.
It also raised concerns about the social consequences of the closure, stating that “Most worrisome is the fact that the refinery shutdown has brought hardship to members of the host communities.”
Beyond refinery-related issues, PETROAN said the downstream market faced instability in 2025 due to aggressive price competition. It noted that “the downstream sector experienced intense price competition between petroleum importers and local refiners,” adding that “this price war led to frequent pump price adjustments resulting to loses of billions of naira to our members, market uncertainty, and reduced margins for retail outlet operators.”
While acknowledging that consumers benefitted in the short term, the association warned that “long-term sustainability and investment confidence were negatively affected.”
PETROAN also assessed the Naira-for-Crude policy introduced to support local refining, stating that “approximately 250,000 – 300,000 barrels per day of crude oil were allocated to domestic refineries under this policy.”
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It said the policy “helped ease foreign exchange demand for petroleum importers and supported local refineries with steady crude feedstock,” but noted that its impact was constrained by operational challenges.
According to the association, “Implementation gaps, delays, and inconsistencies in crude allocation affected refinery operations, while pricing disputes and supply constraints also weakened the policy’s impact.”
On crude oil output, PETROAN reported a modest improvement in 2025, with production at “Approximately 1.3 – 1.5 million barrels per day, including condensates,” but noted that output remained below Nigeria’s OPEC quota due to oil theft and pipeline vandalism, ageing infrastructure and operational inefficiencies, as well as limited upstream investment and funding challenges.
The association stressed that “increased crude production is critical for sustaining domestic refining, improving foreign exchange inflows, and ensuring downstream supply stability.”
Looking ahead to 2026, PETROAN said product availability was expected to improve but cautioned that affordability would depend on exchange rate stability, consistent crude supply, and balanced regulation.
It reaffirmed its recommendations, including refinery privatisation, transparent crude allocation, sustained stakeholder engagement, and accountability in public spending, noting that these steps are essential to stabilising the sector.
PETROAN concluded that Nigeria’s petroleum industry in 2025 showed signs of cautious recovery amid ongoing structural weaknesses, adding that 2026 offers an opportunity to consolidate progress if policies remain transparent, inclusive, and friendly to investors.