Nigeria’s drive to revive its troubled state-owned refineries may be entering a new phase, with Chinese investors being considered for a possible 51 per cent equity stake in the Port Harcourt and Warri refining assets under a long-term partnership model championed by the Nigerian National Petroleum Company Limited (NNPC Ltd).
The proposed arrangement emerged after NNPCL signed a Memorandum of Understanding with Sanjiang Chemical Company Limited and Xinganchen (Fuzhou) Industrial Park Operation and Management Co., Ltd in China for what the company described as a potential technical equity partnership.
Unlike previous refinery rehabilitation contracts, findings indicate the discussions could lead to an NLNG-style ownership structure, where technical partners hold equity, participate in governance, and remain involved in operations over the long term.
Under the proposed framework, the Chinese firms are expected not only to help complete outstanding work at the Port Harcourt and Warri refineries but also support operations, maintenance, capacity expansion, and profitability improvements.
The plan could further extend beyond fuel refining into petrochemicals and gas-based industrial development through the creation of industrial hubs around the refinery complexes.
Speaking after the signing ceremony in Jiaxing City, China, NNPCL Group Chief Executive Officer, Bayo Ojulari, described the agreement as a major milestone reached after months of engagement between both parties.
“All parties recognise mutually beneficial opportunities for the development and long-term sustainable profitability of NNPCL’s refining assets in Nigeria and the collective weight required for success,” Ojulari said.
He added that the agreement represents an important step toward securing capable technical partners for the long-delayed refinery revival project.
“The MoU is a significant step on the journey towards identifying potential technical equity partner(s) to restart and expand NNPCL’s refineries and to explore opportunities in co-located petrochemical and gas-based industries,” he stated.
Industry stakeholders say the structure signals a possible shift in NNPCL’s strategy after years of rehabilitation efforts yielded limited results despite billions of dollars committed to refinery repairs.
Executive Secretary of the Major Energies Marketers Association of Nigeria, Clement Isong, backed the idea of equity-backed technical partnerships, arguing that investors with ownership stakes would be more committed to efficiency and commercial success.
“This is an innovative way of getting the assets to work in an efficient and sustainable way. The challenge we knew was that NNPCL did not have the internal competence or capacity to run those refineries efficiently,” Isong said.
“Now, they have brought a third party, and the key difference is that the third party they have brought is taking equity. He’s a part-owner of the refinery and so would want the refinery to work so he can get returns on his investment.”
For many Nigerians, the development represents more than another refinery deal. It touches a long-standing national frustration over facilities built with public funds but plagued by years of underperformance, shutdowns, and repeated rehabilitation promises.
If discussions advance into binding agreements, the partnership could reshape Nigeria’s downstream petroleum landscape, deepen Chinese participation in the sector, and test whether a commercially driven ownership model can finally deliver what decades of state-led refinery management struggled to achieve.