Modular Refineries Struggle Post-Subsidy Removal in Nigeria

As of the latest data from the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), only five out of the 30 licensed modular refineries in Nigeria have been completed, and merely three are operational. This stagnation follows the removal of petrol subsidies by President Bola Ahmed Tinubu on May 29, 2023, which was intended to redirect funds towards infrastructure and job creation.

The government had anticipated that deregulating the downstream sector would attract investors to domestic refining. Plans were made to establish three modular refineries in each oil-producing state within the Niger Delta, totaling 18 refineries across Rivers, Bayelsa, Akwa Ibom, Delta, Edo, and Cross River.

However, no new modular refineries have commenced operations in the three years since subsidy removal. The Pan Niger Delta Forum (PANDEF) has urged President Tinubu to activate the Modular Refinery Development Fund proposed in 2018 to expedite the establishment of these refineries.