An economic expert, Dr. Sand Mba-Kalu, has called for full transparency and strict accountability in the newly proposed partnership between the Nigerian National Petroleum Company Limited (NNPC Ltd.) and two Chinese firms for the rehabilitation and operation of Nigeria’s state-owned refineries.
Mba-Kalu, Executive Director of the Africa International Trade and Commerce Research, warned that without strong institutional safeguards, the latest refinery initiative could become another costly cycle of failed promises despite billions already spent on refinery repairs.
The warning follows the signing of a Memorandum of Understanding (MoU) between NNPC Ltd. and Chinese firms, Sanjiang Chemical Company Ltd. and Xingcheng (Fuzhou) Industrial Park Operation and Management Company Ltd., aimed at establishing a Technical Equity Partnership (TEP) for the Port Harcourt and Warri refineries.
The Federal Government had reportedly spent about $2.39 billion on the rehabilitation of the two facilities under the previous administration.
Although the Port Harcourt refinery resumed production in November 2024, operations were suspended on 24 May 2025, after NNPC Ltd. disclosed that internal reviews showed the refineries were operating at “monumental losses” and eroding national value.
Speaking in Abuja on Sunday, Mba-Kalu said the latest partnership could mark a major shift for Nigeria’s refining industry if implemented strictly as a commercial and performance-driven arrangement.
He noted that Nigeria’s public refineries had long become symbols of repeated public spending with little economic return, despite years of turnaround maintenance contracts and rehabilitation exercises.
According to him, the key issue is not foreign participation in refinery operations, but whether the country has the right commercial, institutional, and accountability framework to guarantee results.
“The proposed Technical Equity Partnership may be a rational option if it introduces credible partners with proven engineering competence, financing capacity, and operational discipline tied directly to refinery performance,” he said.
He, however, warned that public trust had been badly damaged by repeated refinery commissioning ceremonies and failed operational outcomes.
Mba-Kalu stressed that if the current arrangement merely repackaged previous contracts under a new structure, it would likely end like past interventions.
He questioned why earlier rehabilitation projects failed, whether post-project assessments were ever conducted and published, and if any officials or institutions were held accountable for poor performance.
“What happens to existing contracts and obligations on the Port Harcourt and Warri refineries? Without clear answers, Nigerians will see the new MoU as another expensive cycle of promises rather than a credible reform,” he said.
The expert also demanded public disclosure of financing obligations, revenue-sharing terms, performance benchmarks, penalty clauses, and exit conditions attached to the proposed partnership.
He advocated independent technical oversight involving refinery engineers, financial experts, procurement specialists, regulators, and civil society representatives to monitor implementation and publish periodic progress reports.
Mba-Kalu further called for quarterly accountability reports from NNPC Ltd. detailing refinery output, operational downtime, revenue generation, and capital expenditure.
He added that the arrangement should include technology transfer and structured capacity development for Nigerian engineers and local suppliers.
According to him, refinery operations must be insulated from political interference, opaque procurement systems, and non-commercial decision-making processes.
“If political interference continues, even the best technical partner will fail,” he said.
He also recommended an independent audit of previous refinery rehabilitation projects to help Nigeria identify past failures and strengthen institutional accountability in the oil sector.