In an interview on Channels TV’s Rubbin’ Minds, Shehu Zubair, Director of Human Capital at Associates Partners, emphasised that the Nigerian National Petroleum Company Limited (NNPCL) must rethink its corporate strategy to effectively address the persistent fuel shortages in Nigeria. Zubair underscored that despite being a resource-rich nation, Nigeria continues to grapple with fuel supply challenges due to systemic failures within the NNPCL.
Zubair highlighted that one of the core issues lies in the structural inefficiencies of the NNPCL, which have persisted for decades. “The NNPCL is a fantastic organisation, but it has structural challenges,” he said, pointing out that the company has been tasked with ensuring fuel security but has repeatedly failed in this regard. He noted that even as far back as the 1980s, fuel shortages were common, and the situation remains unchanged today. “That tells you that in terms of performance, they have not done well,” Zubair remarked.
He went on to explain that part of the NNPCL’s struggle stems from confusion about its mandate. In 2021, the NNPCL was transitioned to a limited liability company with a focus on generating profits. However, Zubair noted that the NNPCL has historically functioned more as a socio-economic engine for the Nigerian government, tasked with initiatives such as fuel subsidies. This conflicting dual mandate—balancing profit-making with socio-economic responsibilities—has made it difficult for the company to perform effectively.
“The NNPCL’s role has shifted, but it’s unclear whether they’ve fully adapted to their new reality as a profit-driven entity,” Zubair said. He stressed that policies have been inconsistent and pointed out the need for clearer objectives and better alignment with the company’s restructured goals.
Zubair also addressed the state of Nigeria’s refineries, which have been inoperative for years despite numerous promises and financial allocations. He linked this failure to deeper issues within the country, particularly corruption and weak institutional frameworks. “Corruption is not just an oil and gas issue; it’s a national problem,” Zubair stated, adding that Nigeria has strong individuals but weak institutions, which affects overall performance in every sector.
Adeola Yusuf, an energy policy analyst, also weighed in during the discussion, noting that expectations around the Dangote Refinery easing fuel prices were misplaced. Yusuf explained that, from an economic perspective, the cost of production at the Dangote Refinery is higher than the retail price of petrol. “This is economics, not politics,” he said, cautioning that the refinery’s operations are unlikely to significantly lower fuel prices, as Dangote’s primary objective is profit.
Zubair agreed, asserting that the Dangote Refinery, while a significant achievement, is not a panacea for Nigeria’s fuel woes. “Dangote’s mandate is to make money, not to save the Nigerian economy,” he explained. He emphasised the need for competitive market structures and stronger corporate governance in the oil and gas sector to address issues such as monopolies and price control.
Both experts stressed that while policies are essential, the culture and governance structures driving these policies are just as crucial. Zubair concluded, “It doesn’t matter how good a policy is—if the culture of the people driving it is flawed, it will fail.”
The interview ended with a call for a comprehensive restructuring of the oil and gas sector, particularly in corporate governance and policy implementation. The experts agreed that without stronger institutions and clear, actionable strategies, Nigeria’s fuel crisis would likely persist.
