Like the National Union of Petroleum and Natural Gas Workers (NUPENG), Nigerians equally demand transparency and timely execution of the Memorandum of Understanding signed between the Federal Government and two Chinese companies to revamp the refineries in Warri and Port Harcourt. That is a legitimate demand, considering that previous efforts to fix the refineries failed, largely due to a lack of accountability and transparency.

Therefore, NUPENG’s demand for the painstaking execution of the contracts cannot be more relevant. On no account should the partnership be abandoned halfway at a cost to taxpayers. Nigeria has wasted more than enough resources on the refineries. A peer-assessment of the agreements by foreign and local accountability bodies is equally recommended to avoid doubts. The details must be clear to all, to avoid the ugly experience with Ajaokuta and similar agreements where the country got its fingers burnt.

On April 30, 2026, the Nigerian National Petroleum Company Limited (NNPCL), signed what it called a Memorandum of Understanding (MoU) with two Chinese companies: Sanjiang Chemical Company Limited and Xingcheng (Fuzhuo) Industrial Park Operation and Management Co. Ltd., for a technical equity partnership (TEP), to finalise repairs, operate and expand the Port Harcourt and Warri Refineries after close to 20 years of inactivity. Bashir Bayo Ojulari, the Group CEO of NNPC Ltd, signed the agreement, along with Guan Jianzhong (chairman of Sanjiang Chemical Company) and Bill Bi (chairman of Xingcheng Industrial Park.

The partnership, Nigerians were told, is different from traditional contractor-led models toward a risk and reward sharing mechanism. The scope is to cover the expansion of petrochemical capacities and establish co-located, gas-based industrial hubs.

The NNPC claimed that the MoU covers a potential framework to complete outstanding work at the two refineries, including operations and maintenance. Expansion and upgrade are part of the deal to make the facilities cleaner and more profitable. The MoU also includes capacity expansion as well as harnessing gas and downstream opportunities.

Ojulari called the exercise a significant milestone to lift the country’s status as an oil-producing and refining country. Nigerians sincerely hope so, given that they have heard endless stories regarding the refineries, and a lot of them are empty promises. That is why the call by the National President of NUPENG, Salimon Oladiti, for parties involved in the MoUs to be professional and accountable is crucial.

The MoUs raise several questions that are begging for clarity. First, what is the competence of the two Chinese companies in oil and gas matters? Industry players have raised concerns that Sanjiang Chemical, for instance, has no clear record in crude oil refining and turnaround maintenance, apart from specialising in the production of ethylene oxide, ethylene glycol and surfactants.

Xigcheng (Fuzhou), on the other hand, is said to be a real estate and industrial park development and management company. What was the selection process that recommended the two companies, and in which countries have they signed similar MoUs, and what cognate experience do they bring to the table?

Stakeholders are worried that the two companies have no backing from the Chinese government, unlike major Chinese firms doing large-scale infrastructure contracts in Africa. The two firms are private companies with no sovereign backing. That comes with risks NNPCL must watch out for. What is the financial backing for the MoUs? Do the firms have financial muscle of their own, or are they coming as portfolio investors?

The two refineries in Port Harcourt operate a combined installed capacity of 210,000 barrels per day (bpd). The Warri Refining and Petrochemical Company Limited has an installed capacity of 125,000 bpd. The two were repaired for $2.39 billion in 2021. Port Harcourt worked briefly in November 2024 and shut down. Warri has also remained idle after it was reported in good shape in early 2025. All the stories appear to be lies.

Equally troubling is the fact that the government appeared confused about what to do with the refineries. Ojulari had at different times offered contrasting positions on what to do. For instance, in July 2025, he proposed that selling is not out of the question, arising from a strategic review of the ageing and complex, loss-making assets. Weeks later, he walked back on selling, claiming to now prefer signing technical partnerships, particularly for Port Harcourt and Warri.

Let it not be that the government and NNPCL were at their wits’ end, compelling poorly signed MoUs that are bereft of due processes. Under no condition should Nigeria sign MoUs from a weak and uninformed position. Whatever the case may be, the country mustn’t be shortchanged.

Nigerians still have in mind the 2004 concession deal signed with Indian firm Global Steel Holdings Limited (GSHL), on the Ajaokuta Steel Company and National Iron Ore Mining (NIOMCO). The Federal Government had to revoke the contract in 2008, following allegations of asset stripping and exporting of vital machinery and raw materials, instead of products of finished steel, which was the agreement.
Following litigation that was thus prompted, for breach of contract, Nigeria had to enter an out-of-court settlement, costing the Federal Government $496 million in ransom payment to recover ownership.

This country once had a failed gas contract with Process and Industrial Developments (P&ID). The contract was signed in 2010, but due to a poor contracting and governance system, Nigeria was slammed with an $11 billion arbitral award for a breach. The fine was eventually overturned in a 2023 final settlement. The country may not be that lucky next time.

Nigerians expect that at the end of the day, the MoUs must see the refineries working and profitable. Nigerians look forward to improved local refining to reduce dependence on imported products. Let this not be another failed exercise without consequences!