By Korede Abdullah
In 2007, former President Olusegun Obasanjo sold several public enterprises, including Nigeria’s four refineries, through the Bureau of Public Enterprises (BPE) after they had become severely underutilized. However, upon assuming office, his successor, President Umaru Yar’Adua, promptly reversed the sale of the refineries and restored fuel prices to their pre-increment levels (from N75 to N65), marking the first time in Nigeria’s history that a leader would take such a popular decision.
Nigeria’s four refineries, once the backbone of the country’s petroleum industry, have been moribund and grossly mismanaged to the point of collapse over the last fifteen years. Despite the injection of billions of naira into revitalization efforts, these facilities have failed to show any significant signs of improvement, leaving the country reliant on imported fuel to meet its energy needs. The dismal state of the refineries can be attributed to a toxic mix of corruption, bureaucratic inefficiencies, and other deep-seated factors.
My question remains whether Nigeria should reconsider selling the refineries to private investors to ensure efficiency in the oil sector or continue investing in their resuscitation and maintaining them as state-run facilities. Proponents of privatization argue that private ownership can bring much-needed expertise and investment to revamp the refineries, while opponents believe that state control is essential for strategic and economic reasons.
As Nigeria grapples with the challenges of its oil sector in terms of scarcity, skyrocketed prices, inefficiency and corruption, the decision to sell or retain the refineries has significant implications for the country’s energy security, economic development, and employment. The choice between privatization and state control will depend on careful consideration of the potential benefits and drawbacks of each option.
*ABDULLAH, a staff of Africa Health Report AHR, contributes this opinion from Lagos
