OSAS EMMANUEL
NIGERIA: An activist, and convener of Concerned Nigerians Group, Deji Adeyanju, has expressed significant concerns over the decision by the Nigerian National Petroleum Company (NNPC) Limited to reduce its stake in the Dangote Refinery from 20% to 7.2%.
Adeyanju, in an open letter addressed to President Bola Tinubu, highlighted several issues that should warrant immediate attention and transparency from the government.
The reduction of NNPC Limited’s stake, according to Adeyanju, represents a substantial loss in potential revenue for the Nigerian government.
He argued that owning a significant share in the refinery would have ensured a steady stream of revenue through dividends and profit sharing.
“To provide context, in September 2021, the Nigerian National Petroleum Company Limited acquired a 20% stake in the Dangote Refinery for $2.76 billion. This investment was intended to secure a significant share in the refinery, which is expected to be a crucial asset for Nigeria’s energy sector. The initial financing included $1.036 billion provided by Lekki Refinery Funding Limited, with $1 billion paid directly to Dangote Refinery and $36 million allocated for transaction costs. The remaining $1.76 billion was to be paid through a discount on crude oil prices and future dividends.
“By reducing its stake, NNPC Limited diminishes its share of future profits, directly impacting the funds available for public services, infrastructure, and other critical needs.” Adeyanju said
This decision, he contends, sacrifices long-term financial benefits for short-term expediency.
Pointing out the strategic implications of this move, Adeyanju said that with a smaller stake, NNPC Limited will have less influence over the refinery’s operations.
“This diminished influence could lead to decisions that do not align with Nigeria’s national energy policies or best interests.”
He further raised concerns about whether this decision was made with adequate consideration of its broader implications for Nigeria’s energy security and economic stability.
This is as he noted that there has been little or no detailed explanation provided to the public regarding the reasons behind the reduction in NNPC Limited’s shares.
The activist emphasized that this decision would have direct implications for Nigerian taxpayers as this reduction in potential revenue could impact the funds available for critical national development projects, affecting the quality of life for Nigerian citizens.
“Moreover, the lack of transparency surrounding this decision is deeply troubling. There has been little or no detailed explanation provided to the public regarding the reasons behind the reduction in NNPC Limited’s shares. Was this decision driven purely by financial constraints, or were there other factors at play? The absence of clear, comprehensive communication from NNPC Limited fuels suspicion and erodes public trust in our institutions. It is imperative that NNPC Limited and the Nigerian government provide a full and transparent account of the motivations and deliberations that led to this decision.
“Furthermore, this decision has direct implications for Nigerian taxpayers. By capping the investment, NNPC Limited avoids potential immediate financial strains, but it also forfeits future financial benefits that could have supported public services and infrastructure development. The reduction in potential revenue could impact the funds available for critical national development projects, thereby affecting the quality of life for Nigerian citizens.”
However, he urged the Nigerian government and NNPC Limited to reconsider this decision or, at the very least, provide a detailed and transparent explanation to the public.
He stressed that Nigerians deserve to understand the rationale behind decisions that significantly impact national assets and future prosperity.
“The people of Nigeria deserve to understand the rationale behind decisions that significantly impact our national assets and future prosperity. It is essential to restore public confidence through openness and accountability. Failing to do so will only deepen the distrust and skepticism that many Nigerians already feel towards our institutions.
“In conclusion, the reduction of NNPC Limited’s stake in the Dangote Refinery is a decision laden with negative implications for Nigerian taxpayers and raises serious concerns about transparency and potential foul play. I call upon the Nigerian government and NNPC L Limited to address these concerns promptly and ensure that all future decisions regarding our national assets are made with the utmost integrity and in the best interest of the Nigerian people.”
