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Niger Delta, NHRC and PIB

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Niger Delta

By Jerome-Mario Utomi

I never had expected that opinion articles about the Niger Delta, a region bedevilled by tremendous odds with an improbable chance of survival, will precisely in a space of four days come from me in this quick succession as I have other pressing concerns to comment on.

But this particular one stems from a reaction by a reader to the earlier one entitled Why Niger Delta is troubled. The piece, which had the resonated chant of a crude oil spill in Polobubo/Opuama Communities, Warri North Local Government Area of Delta as its central plot, among other things, classified the critical issues confronting the region as follows.

First, the existence of multiple but an absolute regulatory framework that characterises the oil and gas exploration and production in Nigeria and fuels International Oil Companies (IOCs’) reluctance to adhere strictly to the international best practices as it relates to their operational environment.

Secondly, the unwillingness of successive administrations to identify the Niger Delta as a troubled spot that must be regarded as a special area for purposes of development-as recommended by the colonial government long before independence.

While commending efforts made by the people of Polobubo/Opuama community, particularly lawyers under the umbrella of the Gbaramatu Lawyers Association (Gbaramatu Oloutomo-Abu Gbolei), who in an open letter dated March 8, 2021, issued a 14-day ultimatum to the owners of the facility to address the present challenge, the said reader (mentioned above) lamented that such efforts will continue to be frustrated by both national and foreign media as they will not accord it the needed attention/prominence.

He, therefore, advised that to make such an effort most rewarding, the community should approach/ petitions National Human Right Commission (NHRC).

NHRC, he explained, was established by the National Human Right Act 1995, to; create an enabling environment for extra-judicial recognition, promotion, protection and enforcement of human rights, in addition to providing a forum for public enlightenment and dialogue on human rights while facilitating the implementation of Nigeria’s various international and regional treaty obligations on human rights issues.

Though I was totally disoriented by his position on the National Human Rights Commission, I tried not to betray my disagreement with such position. Alas! I could not pretend for too long that I was flowing for he soon observed the utter confusion and frustration raging in my mind.

To douse the nagging helplessness enveloping me as regards his suggestion about going to NHRC, I explained to him that the reservation in my view does not reflect a lack of respect for the Commission. Rather, it is predicated on the memories of their not too deeds towards the region which about a year ago formed a similar intervention, entitled; Re-thinking the National Human Rights Commissions (NHRC) roles in the Niger Delta.

As a background, the plight of the people of the Niger Delta region explains a painful consequence of prostrated neglect and low investments in the region by our leaders and in order words, act as an essential step towards understanding action-decision, or error of judgment that currently perpetuates poverty, consolidates powerlessness and promotes restiveness in the region.

In the same vein, there are many institutional failures that have kept the region on its knees.

But among these failures, the inability of the National Human Rights Commission to rise onto its constitutional responsibility to the people of the region. A failure that has resulted in the generation of misinformation, disinformation, innuendos, falsehood and outright assault on reason(s) fuelling the backward nature of the Niger-Delta regions.

Notably, so many families in the region have witnessed so many disappointing moments as a result of the government’s insensitivity. The government on its part has made so many speeches and excuses without adopting or abiding by the basic principles that helped other nations grow in social cohesion or through equitable sharing of benefits from the mineral deposits from the region.

And in the face of these verifiable violations and deprivations, the National Human Rights Commission failed to inform the government that it is only through equity, justice, and restructuring of the nation that the country would enjoy economic and social progress that flows from stability.

The stunning thing about the commission’s inaction is that it is happening when the global community is aware that communal rights to a clean environment and access to clean water supplies are being violated in the region, with aquifers and other water supply sources being adversely affected by industrial or other activities without the communities being adequately compensated for their losses. And the oil industry by its admission has abandoned thousands of polluted sites in the region which need to be identified and studied in details.

Shockingly ‘interesting’ is that despite the not too impressive performance of NHRC, The commission is not without supporters.

While many argue that the commission cannot be blamed for environmental woes resulting from oil exploration and production in the Niger Delta region as the agency cannot investigate without complaint or petition from either group or individual- as wading in without invitation amounts to descending into the arena.

Some expressed the views that the plight of the Niger Deltans resulting from faulty/weak legal framework should be directed to the National Assembly as the commission is not the legislative arm of the government.

To others, expecting the commission to enforce compliance will translate to waiting till eternity as they are neither staffed with security operatives like the Economic and Financial Crimes Commission (EFCC) nor equipped with technical knowledge like the Federal Ministry of environment, to detect when organisations are not applying international best practices in their operations.

Though clear enough, this point cannot hold water when faced with a number of embarrassing facts.

Fundamentally, separate from the belief that ‘the environment is as important to the nation’s well-being as the economy and should deserve similar attention, their arguments remain sophistry looking at the functions and powers of the commission as provided in Section 5 of its enabling Act.

It provides that the commission shall deal with all matters relating to the promotion and protection of human rights as guaranteed by the constitution of the Federal Republic of Nigeria and other human rights instruments to which Nigeria is a party; Monitor and investigate all alleged cases of human rights violations in Nigeria and make appropriate recommendation to the federal government for the prosecution and such other actions as it may deem expedient in each circumstance. And assist victims of human rights violation to seek appropriate redress and remedies on their behalf.

Admittedly, NHRC may not have the power to make laws as argued by some commentator, but it can engineer people-purposed oil exploration and production regime by collaborating with the National Assembly through sponsorship of Bills and Memoranda; NHRC may be technically disempowered to investigate or detect operators non-adherence to the international best practice, but have the power to productively partner with other government Ministries and agencies that perform this task both effectively and efficiently; the Commission may not be capped with the task force to enforce standards, but can assist communities where such violation has taken place with legal actions against such violator. The vitality of such support will enrich litigation in favour of the communities; deepen the respect for the Commission among the operators while lifting litigation cost from communities.

There are other similar but separate examples.

Without going into specifics, concepts, provisions and definitions, it’s been identified that oil exploration and production in Nigeria are guided by so many laws. Yet, available data and our mind’s eye testify that these laws/Acts in question are no longer achieving their purpose.

Against this backdrop, Nigerians would have expected NHRC as a responsive and responsible organization to ask; if truly these laws are fundamentally effective and efficient, why are they not providing a strong source of remedy for individuals and communities negatively affected by oil exploration and production in the coastal communities as the lives of the people in that region currently portrays? If these frameworks exist and have been comprehensive as a legal solution to the issues of oil-related violations, why are they not enforceable?

While the watching world expects answers to these questions, this piece, believes that signing the Petroleum Industry Bill (PIB) and not NHRC will save the region.

To explain this fact, going by what industry watchers are saying, the Bill, if passed to law, will engineer the development of host communities in ways that entail all-encompassing improvement, brings a process that builds on itself and involves both individuals and social change. Attracts growth and structural change, with some measures of distributive equity, modernization in social and cultural attitudes, foster a degree of transformation and stability, bring an improvement in health and education and an increase in the quality of lives and employment of the people.

This claim is ‘more pronounced in sections on community relations provisions such as Section 241 which among other provisions mandates that Settlors (a holder of an interest in a petroleum prospecting licence or petroleum mining lease or a holder of an interest in a licence for midstream petroleum operations, whose area of operations is located in or appurtenant to any community or communities) shall incorporate a trust for the benefit of the host communities.

The constitution of each host community development trust, the bill added, shall provide that the applicable host community development trust fund be used exclusively for the implementation of the applicable host community development plan.

There is also another ingrained way of how the Bill will assist in clearing the Augean Stable in the Niger Delta. This has to do with the Prohibition of Gas Flaring in section 104. Going by its provisions, the Bill in a bid to fulfil its obligations under the United Nations Framework Convention on Climate Change (UNFCCC) and similar conventions, demands strict adherence to a gas flaring plan.

A licensee or lessee, it explained, producing natural gas is expected to, within 12 months of the effective date; submit a natural gas flare elimination and monetization plan to the commission, which shall be prepared in accordance with regulations made by the commission under this Act. A Licensee or Lessee who fails to adhere to the provision shall pay a penalty prescribed pursuant to the Flare Gas (Prevention of Waste and Pollution) Regulations.

With these and other provisions, there is no doubt that if the Federal Government is interested in serving and saving the people of the Niger Delta region, they are left with no other option than to pass and sign the PIB to law.

Since its objectives will foster sustainable prosperity within host communities and provide direct social and economic benefits from petroleum operations to host communities while enhancing peaceful and harmonious co-existence among licensees or lessees and host communities.

Jerome-Mario Utomi is the Programme Coordinator (Media and Public Policy), Social and Economic Justice Advocacy (SEJA), Lagos. He could be reached via [email protected] or 08032725374.

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If You Understand Nigeria, You Fit Craze

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confusion nigeria

By Prince Charles Dickson PhD

There is a popular Nigerian lingo cum proverb that has graduated from street humour to philosophical thesis: “If dem explain Nigeria give you and you understand am, you fit craze.” It sounds funny. It is funny. But like most Nigerian jokes, it is also dangerously accurate.

Catherine’s story from Kubwa Road is the kind of thing that does not need embellishment. Nigeria already embellishes itself. Picture this: a pedestrian bridge built for pedestrians. A bridge whose sole job description in life is to allow human beings cross a deadly highway without dying. And yet, under this very bridge, pedestrians are crossing the road. Not illegally on their own this time, but with the active assistance of a uniformed Road Safety officer who stops traffic so that people can jaywalk under a bridge built to stop jaywalking.

At that point, sanity resigns.

You expect the officer to enforce the law: “Use the bridge.” Instead, he enforces survival: “Let nobody die today.” And therein lies the Nigerian paradox. The officer is not wicked. In fact, he is humane. He chooses immediate life over abstract order. But his humanity quietly murders the system. His kindness baptises lawlessness. His good intention tells the pedestrian: you are right; the bridge is optional.

Nigeria is full of such tragic kindness.

We build systems and then emotionally sabotage them. We complain about lack of infrastructure, but when infrastructure shows up, we treat it like an optional suggestion. Pedestrian bridges become decorative monuments. Traffic lights become Christmas decorations. Zebra crossings become modern art—beautiful, symbolic, and useless.

Ask the pedestrians why they won’t use the bridge and you’ll hear a sermon:

“It’s too stressful to climb.”

“It’s far from my bus stop.”

“My knee dey pain me.”

“I no get time.”

“Thieves dey up there.”

All valid explanations. None a justification. Because the same person that cannot climb a bridge will sprint across ten lanes of oncoming traffic with Olympic-level agility. Suddenly, arthritis respects urgency.

But Nigeria does not punish inconsistency; it rewards it.

So, the Road Safety officer becomes a moral hostage. Arrest the pedestrians and risk chaos, insults, possible mob action, and a viral video titled “FRSC wickedness.” Or stop cars, save lives, and quietly train people that rules are flexible when enough people ignore them.

Nigeria often chooses the short-term good that destroys the long-term future.

And that is why understanding Nigeria is a psychiatric risk.

This paradox does not stop at Kubwa Road. It is a national operating system.

We live in a country where a polite policeman shocks you. A truthful politician is treated like folklore—“what-God-cannot-do-does-exist.” A nurse or doctor going one year without strike becomes breaking news. Bandits negotiate peace deals with rifles slung over their shoulders, attend dialogue meetings fully armed, and sometimes do TikTok videos of ransoms like content creators.

Criminals have better PR than institutions.

In Nigeria, you bribe to get WAEC “special centre,” bribe to gain university admission, bribe to choose your state of origin for NYSC, and bribe to secure a job. Merit is shy. Connection is confident. Talent waits outside while mediocrity walks in through the back door shaking hands.

You even bribe to eat food at social events. Not metaphorically. Literally. You must “know somebody” to access rice and small chops at a wedding you were invited to. At burial grounds, you need connections to bury your dead with dignity. Even grief has gatekeepers.

We have normalised the absurd so thoroughly that questioning it feels rude.

And yet, the same Nigerians will shout political slogans with full lungs—“Tinubu! Tinubu!!”—without knowing the name of their councillor, councillor’s office, or councillor’s phone number. National politics is theatre; local governance is invisible. We debate presidency like Premier League fans but cannot locate the people controlling our drainage, primary schools, markets, and roads.

We scream about “bad leadership” in Abuja while ignoring the rot at the ward level where leadership is close enough to knock on your door.

Nigeria is a place where laws exist, but enforcement negotiates moods. Where rules are firm until they meet familiarity. Where morality is elastic and context-dependent. Where being honest is admirable but being foolish is unforgivable.

We admire sharpness more than integrity. We celebrate “sense” even when sense means cheating the system. If you obey the rules and suffer, you are naïve. If you break them and succeed, you are smart.

So, the Road Safety officer on Kubwa Road is not an anomaly. He is Nigeria distilled.

Nigeria teaches you to survive first and reform later—except later never comes.

We choose convenience over consistency. Emotion over institution. Today over tomorrow. Life over law, until life itself becomes cheap because law has been weakened.

This is how bridges become irrelevant. This is how systems decay. This is how exceptions swallow rules.

And then we wonder why nothing works.

The painful truth is this: Nigeria is not confusing because it lacks logic. It is confusing because it has too many competing logics. Survival logic. Moral logic. Emotional logic. Opportunistic logic. Religious logic. Tribal logic. Political logic. None fully dominant. All constantly clashing.

So, when someone says, “If dem explain Nigeria give you and you understand am, you fit craze,” what they really mean is this: Nigeria is not designed to be understood; it is designed to be endured.

To truly understand Nigeria is to accept contradictions without resolution. To watch bridges built and ignored. Laws written and suspended. Criminals empowered and victims lectured. To see good people make bad choices for good reasons that produce bad outcomes.

And maybe the real madness is not understanding Nigeria—but understanding it and still hoping it will magically fix itself without deliberate, painful, collective change.

Until then, pedestrians will continue crossing under bridges, officers will keep stopping traffic to save lives, systems will keep eroding gently, and we will keep laughing at our own tragedy—because sometimes, laughter is the only therapy left.

Nigeria no be joke.

But if you no laugh, you go cry—May Nigeria win.

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Post-Farouk Era: Will Dangote Refinery Maintain Its Momentum?

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By Abba Dukawa

“For the marketers, I hope they lose even more. I’m not printing money; I’m also losing money. They want imports to continue, but I don’t think that is right. So I must have a strategy to survive because $20 billion of investment is too big to fail. We are in a situation where we will continue to play cat and mouse, and eventually, someone will give up—either we give up, or they will.” —Aliko Dangote

This statement reflects that while Dangote is incurring losses, he remains committed to his investment, determined to outlast competitors reliant on imports. He believes that persistence and strategy will eventually force them to concede before he does.

Aliko Dangote has faced unprecedented resistance in the petroleum sector, unlike in any of his other business ventures. His first attempt came on May 17, 2007, when the Obasanjo administration sold 51% of Port Harcourt Refinery to Bluestar Oil—a consortium including Dangote Oil, Zenon Oil, and Transcorp—for $561 million. NNPC staff strongly opposed the sale. The refinery was later reclaimed under President Yar’adua, a setback that provided Dangote a tough but invaluable lesson. Undeterred, he went on to build Africa’s largest refinery.

As a private investor, Dangote has delivered much-needed infrastructure to Nigeria’s oil-and-gas sector. Yet, his refinery faces regulatory hurdles from agency’s meant to promote efficiency and growth. Despite this monumental private investment in the nation’s downstream sector, powerful domestic and foreign oil interests may have influenced Farouk Ahmad, former NMDPRA Managing Director, to hinder the refinery’s operations.

The dispute dates back to July 2024, when the NMDPRA claimed that locally refined petroleum products including those from Dangote’s refinery were inferior to imported fuel.  Although the confrontation appeared to subside, the underlying rift persisted. Aliko Dangote is not one to speak often, but the pressure he is facing has compelled him to break his silence. He has begun to speak out about what he sees as a deliberate targeting of his investments, as his petroleum-refining venture continues to face repeated regulatory and institutional challenges.

The latest impasse began when Dangote accused the NMDPRA of issuing excessive import licenses for petroleum products, undermining local refining capacity and threatening national energy security. He alleged that the regulator allowed the importation of cheap fuel, including from Russia, which could cripple domestic refineries such as his 650,000‑barrel‑per‑day Lagos plant.

 The conflict intensified after Dangote publicly accused Farouk Ahmad, former head of NMDPRA, of living large on a civil servant’s salary. Dangote claimed Ahmad’s lifestyle was way too lavish, pointing out that four of his kids were in pricey Swiss schools. He took his grievance to the ICPC, alleging misconduct and abuse of office.

It’s striking how Nigerian office holders at every level have mastered the art of impunity. Even though Ahmad dismissed the accusations but the standoff prompting Ahmad’s resignation. But the bitter irony these “public servants” tasked with protecting citizens’ interests often face zero consequences for violating policies meant to safeguard the Nation and public interest.

The clash of titans lays bare deeper flaws in Nigeria’s petroleum governance. It shows how institutional weaknesses turn regulatory disputes into personal power plays. In a system with robust norms, such conflicts would be settled via clear rules, independent oversight, and transparent processes not media wars and public accusations.

Even before completion, the refinery’s operating license was denied. Farouk Ahmad claimed Dangote’s petrol was subpar, ordering tests that appeared aimed at public embarrassment. Dangote countered with independent public testing of his diesel, challenging the regulator’s claims.

He also invited Ahmad to verify the tests on-site, but the offer was declined. Moreover, NNPC initially refused to supply crude oil, forcing Dangote to source it from the United States a practice that continues.

President Tinubu later directed the NNPC to resume crude supplies and accept payment in naira, reportedly displeasing the state oil company. In addition to presidential directives, Farouk claimed Dangote was producing petrol beyond the approved quantity and insisted that crude oil be purchased exclusively in U.S. dollars a condition Dangote accepted.

From the public’s point of view, the Refinery is a game-changer for Nigeria, with the potential to end fuel imports and boost the economy. With a capacity of 650,000 barrels per day, it produces around 104 million liters of petroleum products daily, meeting 90% of Nigeria’s domestic demand and allowing exports to other West African countries.

The Dangote Refinery is poised to earn foreign exchange, stabilize fuel prices, and strengthen Nigeria’s energy security. However, the ongoing dispute surrounding the refinery underscores the challenges of aligning national interests with regulatory and institutional frameworks.

The Dangote Refinery’s growing dominance has sparked concerns among stakeholders like NUPENG and PENGASSAN, who fear it could lead to a private monopoly, stifling competition and harming smaller players. This concern stems from the refinery’s rejection of the traditional ₦5 million-per-truck levy on petroleum shipments.

However, Dangote has taken steps to address these concerns, reducing the minimum purchase requirement from 2 million liters to 250,000 liters, opening the market to smaller operators and strengthening distribution networks. The refinery has also purchased 2,000 CNG trucks to maintain operations, emphasizing its commitment to making energy affordable and accessible

Many are watching closely to see if Dangote’s actions are driven by a desire for transparency and fairness in Nigeria’s oil and gas sector or private business interests. Did Dangote genuinely want to fight the corruption going on in the sector?, Will Dangote refinery operate for the common good or seek market dominance? Did Farouk Ahmad act in the public interest or obstruct the refinery for hidden oil interests? Will the Dangote Refinery Maintain Its Momentum in the Post-Farouk Era?The dispute between Dangote and Farouk Ahmad remains shrouded in mystery, with the ICPC investigation likely to uncover the truth

To many, the government faces a delicate balancing act: protecting local refiners while ensuring fair competition. While some argue that Dangote’s success shouldn’t come at the expense of smaller players, others see it episodes like this reveal persistent contradictions: powerful interests, fragile institutions, and blurred lines between regulation and politics.The Petroleum Industry Act (PIA) promised a new era of clarity, efficiency, and accountability, but its implementation has been slow. The PIA’s success hinges on addressing these challenges.

What benefits one party can indeed threaten another. Despite entering the sector with good intentions, Dangote has faced relentless pushback, all eyes are on whether the refinery can sustain its momentum. Analysts and commentators are sharing their perspectives based on available data from relevant institutions. If anyone spreads false information, the truth will eventually come out

Dukawa is a journalist, public‑affairs analyst, and political commentator. He can be reached at [email protected]

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Dangote, Monopoly Power, and Political Economy of Failure

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Dangote monopoly Political Economy of Failure

By Blaise Udunze

Nigeria’s refining crisis is one of the country’s most enduring economic contradictions. Africa’s largest crude oil producer, strategically located on the Atlantic coast and home to over 200 million people, has for decades depended on imported refined petroleum products. This illogicality has drained foreign exchange, weakened the naira, distorted investment incentives, and hollowed out state institutions. Instead of catalysing industrialisation, Nigeria’s oil wealth became a mechanism for capital flight, rent-seeking, and institutional decay.

With the challenges surrounding the refining of crude oil, the establishment of Dangote Refinery signifies an important historic moment. The refinery promises to reduce fuel imports to a bare minimum, sustain foreign exchange growth, ensure there is constant fuel domestically, and strategically position Nigeria as a regional exporter of refined oil products if functioned at full capacity. Dangote Refinery symbolises what private capital, technology, and ambition can achieve in Africa following years of fuel queues, subsidy scandals, and global embarrassment.

Nigerians must have a rethink in the cause of celebration. Nigeria’s refining problem is not simply about capacity; it is about systems. Without addressing the policy failures and institutional weaknesses that made Dangote an exception rather than the rule, the country risks replacing one failure with another, this time cloaked in private-sector success.

For a fact, Nigeria desperately needs the emergence of Dangote refinery, and its success is in the national interest. Hence, this is not an argument against the Dangote Refinery. But history warns that structural failures are not solved by scale alone. Over the year, situations have shown that without competition and strong institutions, concentrated market power, whether public or private, can undermine price stability, energy security, and consumer welfare.

The Long Silence of Refinery Investments

Perhaps the most troubling question in Nigeria’s oil history is why none of the global oil majors like Shell, ExxonMobil, Chevron, Total, or Agip has built a major refinery in Nigeria for over four decades. These companies operated profitably in Nigeria, extracted their crude, and sold refined products back to the country, yet never committed capital to domestic refining.

Over the period, it has been shown that policy incoherence has been the cause, not a matter of technical incapacity, such as price controls, resistant licensing processes, subsidy arrears, frequent regulatory changes, and political interference, which made refining an unattractive investment. Importation, by contrast, offered quick returns, lower political risk, and guaranteed margins, often backed by government subsidies.

Nigeria carelessly designed a system that rather rewarded importers and punished refiners. Dangote did not succeed because the system improved; he succeeded despite it. His refinery exists largely because of the concessions from the government, exceptional financial capacity, political access, and a willingness to absorb risks that institutions should ordinarily mitigate. This raises a deeper concern; when institutions fail, progress becomes dependent on extraordinary individuals rather than predictable systems.

The Tragedy of NNPC Refineries

If private investors stayed away, Nigeria’s state-owned refineries should have filled the gap. Instead, the Port Harcourt, Warri, and Kaduna refineries became monuments to mismanagement. Records have shown that between 2010 and 2025, Nigeria reportedly wasted between $18 billion and $25 billion, over N11 trillion, just for Turn Around Maintenance and rehabilitation. Kaduna Refinery alone is estimated to have consumed over N2.2 trillion in a decade.

Despite these expenditures, output remained negligible. This was not merely a technical failure but a governance one. Contracts were poorly monitored, accountability was absent, and consequences were nonexistent. In functional systems, such outcomes trigger investigations, sanctions, and reforms. In Nigeria, the cycle simply repeated itself, eroding public trust and deepening dependence on imports.

Where Is BUA?

Dangote is not the only Nigerian conglomerate to announce refinery ambitions. In 2020, BUA Group unveiled plans for a 200,000-barrels-per-day refinery. Years later, progress remains unclear, timelines have shifted, and execution appears stalled.

This pattern is revealing. When multiple large investors struggle to translate plans into reality, the issue is not ambition but environment. Refinery projects in Nigeria appear viable only at a massive scale and with extraordinary political leverage. Smaller or mid-sized players are effectively crowded out, not by market forces, but by systemic dysfunction.

Policy Failure and the Singapore Comparison

Nigeria often aspires to emulate Singapore’s refining and petrochemical success. The comparison is instructive. Singapore has no crude oil, yet built one of the world’s most sophisticated refining hubs through consistent policy, investor protection, infrastructure planning, and regulatory certainty.

Nigeria chose a different path: price controls, subsidies, weak contract enforcement, and politically motivated policy reversals. Refineries became tools of patronage rather than productivity. Capital exited, infrastructure decayed, and import dependence deepened. The outcome was predictable.

The Cost of Import Dependence

For years, Nigeria spent billions of dollars annually importing petrol, diesel, and aviation fuel. This placed constant pressure on foreign reserves and the naira. Petrol subsidies alone were estimated at N4-N6 trillion per year, often exceeding national spending on health, education, or infrastructure.

Even after subsidy removal, legacy costs remain: distorted consumption patterns, weakened public finances, and entrenched interests built around importation. These interests did not disappear quietly.

Who Really Benefited from the Subsidy?

Although framed as pro-poor, fuel subsidies disproportionately benefited importers, traders, shipping firms, depot owners, financiers, and politically connected intermediaries. Smuggling across borders meant Nigerians subsidised fuel consumption in neighbouring countries.

Ordinary citizens received marginal relief at the pump but paid far more through inflation, deteriorating infrastructure, and underfunded public services. The subsidy system functioned less as social protection and more as elite redistribution.

The Traders’ Dilemma

Why did major fuel marketers like Oando invest in refineries abroad but not in Nigeria? Again, incentives explain behaviour. Importation offered faster returns, lower capital requirements, and political insulation. Domestic refining demanded long-term investment under unstable rules.

In an irrational system, rational actors optimise accordingly. Importation thrived not because it was efficient, but because policy made it so.

FDI and the Confidence Problem

Sustainable Foreign Direct Investment follows domestic confidence. When local investors, who best understand political and regulatory risks, avoid long-term industrial projects, foreign investors take note. Capital flows to environments with predictable pricing, rule of law, and policy consistency.

Nigeria’s challenge is not attracting speculative capital, but building conditions for patient, productive investment.

Dangote and the Monopoly Question

Dangote Refinery deserves credit. But scale brings power, and power demands oversight. If importers exit and no competing refineries emerge, Dangote could dominate refining, pricing, and supply. Nigeria’s experience with cement, where domestic production rose but prices soared due to limited competition, offers a cautionary tale.

Markets function best with competition. Without it, price manipulation, supply risks, and weakened energy security become real dangers, especially in countries with fragile regulatory institutions.

The Way Forward: Competition, Not Replacement

Nigeria does not need to weaken Dangote; it needs to multiply Dangotes. The goal should be a competitive refining ecosystem, not a replacement of a public monopoly with a private monopoly.

This requires transparent crude allocation, open access to pipelines and storage, fair pricing mechanisms, and strong antitrust enforcement. State refineries must either be professionally concessional or decisively restructured. Stalled projects like BUA’s should be unblocked, and modular refineries should be supported.

The Litmus Test

Nigeria’s refining crisis was decades in the making and cannot be solved by one refinery, however large. Dangote Refinery is a turning point, but only if embedded within systemic reform. Otherwise, Nigeria risks trading one form of dependency for another.

The true test is not whether Nigeria can refine fuel, but whether it can build fair, open, and resilient institutions that serve the public interest. In refining, as in democracy, excessive concentration of power is dangerous. Competition remains the strongest safeguard.

Blaise, a journalist and PR professional, writes from Lagos and can be reached via: [email protected]

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