Business
Experts List Investors’ Challenges On Building Of Refineries
If stakeholders’ submissions are anything to go by, then, the dream of the nation to increase its domestic petroleum products refining from 445,000 barrels per day (bpd) to 1,429,000 bpd may not see the light of the day.
The experts, who spoke to The Tide in Opobo Town over the weekend in separate chats, said unless issues bedeviling case of doing busines in the oil-rich Niger Delta region, and a clear cut fiscal regime are tackled, no investor will be moved to commit resources into building of refineries in Nigeria.
A petroleum expert and Managing Director of Enigma-Petro-Data Investment Company Limited, Dr. Endwell Minimah, said that Inteernational Oil Companies (IOCs), operating in the country must stop the treatment of Nigerian’s citizens like trading animals and their land as rejected colony, rather they should invest in the energy sector to retain access to the nation’s resources.
Some of the world’s largest independent oil traders, Minimah stressed, benefited for years from exporting Nigeria’s crude and in turns sell the refined petroleum products to the country without putting money into developing the sector.He emphasised that “if you have been selling to me (refined) products for eight years and you cannot put a foothold in Nigeria, then I should not be buying products from you”.
On the failed efforts to involve private sector, he maintained that in 2002, 18 License to Establish (LTE), were offered investors to build refineries by the Department of Petroleum Resources (DPR) but, of today, only one of them have come on stream with just 1,000 barrels (bpd) capacity. The petroleum scientist maintained that, the Nigerian National Petroleum Corporation (NNPC) refineries in Warri, Kaduna and two in Port Harcourt, have an installed capacity of 445,000 barrels per day (bpd), stressing that more worrisome is the fact that despite efforts to increase local refining capacity to conserve foreign exchange, Nigeria’s three refineries could only produce less than 43,743,273 million liters of fuel last month as against the nation’s daily consumption of over 40 million liters.
He said that, the country request for foreign exchange for imports of petroleum products, which currently stands at 45 percent will increase in the coming months unless something drastic is done about the spate of the refineries.
Minimah stressed further that, though the Corporation had hinted of arrangement to ramp up production from the 445,000 bpd to 1,429,000, the plan is yet to come to fruition as refineries are now operating at less than 40 capacities.
According to DPR, he said, the increase in refining capacity is to be achieved from the licensing of 25 private refineries by the Agency.
In his view, Dr Charlton Reuben Pepple, said Shell Petroleum Development Company Nigeria Limited (SPDC) cannot build a refinery in Nigeria due to the fact that there are surplus refineries across the globe, adding that refineries were no longer profitable, hence the decision of some firms to invest in the gas sector as alternative.
He said that with respect to downstream, Shell is divesting from refineries all over the world because there is ~us of refineries; Shell no longer own refineries even in the United Kingdom.
Pepple, who is the Managing Director of Afik Petro-Base Engineering Limited, Lagos, explained “that while most of the IOCs are already overburdened with the huge cost involved in operating in the upstream sector of Nigeria, question have been raised as to the economic sensibility of investing in the downstream sector.
Bethel Sam Toby
The Central Bank of Nigeria (CBN) yesterday said 33 banks have met new minimum capital requirements under its recapitalisation programme, raising a combined N4.65 trillion to strengthen the financial system.
The apex bank disclosed this in a statement marking the end of the exercise, which commenced in March 2024 and drew participation from domestic and foreign investors.
The statement was jointly signed by the Director of Banking Supervision, Olubukola Akinwunmi, and the Acting Director of Corporate Communications, Hakama Sidi-Ali.
The statement said “Over the 24-month period, Nigerian banks raised a total of N4.65tn in new capital, strengthening the resilience of the financial system and enhancing its capacity to support the economy.”
The regulator said local investors accounted for 72.55 per cent of the funds, while international investors contributed 27.45 per cent, reflecting continued confidence in the sector.
Commenting on the outcome, the CBN Governor, Olayemi Cardoso, said in the statement, “The recapitalisation programme has strengthened the capital base of Nigerian banks, reinforcing the resilience of the financial system and ensuring it is well-positioned to support economic growth and withstand domestic and external shocks.”
It added that while 33 banks have complied with the new thresholds, a few others are still undergoing regulatory and legal processes.
The statement noted, “The CBN confirms that 33 banks have met the revised minimum capital requirements established under the programme.
“A limited number of institutions remain subject to ongoing regulatory and judicial processes, which are being addressed through established supervisory and legal frameworks.
“All banks remain fully operational, ensuring continued access to banking services for customers.”
The apex bank stressed that the exercise was executed without disrupting banking operations, ensuring uninterrupted access to services nationwide.
It further stated that key prudential indicators have improved, particularly capital adequacy ratios, which remain above global Basel benchmarks.
The minimum ratios were set at 10 per cent for regional and national banks and 15 per cent for banks with international licences.
The bank also said the recapitalisation coincided with a gradual exit from regulatory forbearance, a move it said improved asset quality, strengthened balance sheet transparency, and enhanced overall stability.
To preserve these gains, the CBN said it has reinforced its risk-based supervision framework, mandating periodic stress tests and adequate capital buffers for banks.
It added that supervisory and prudential guidelines would be reviewed regularly to strengthen governance, risk management, and resilience across the sector.
“The successful completion of the programme establishes a stronger and more resilient banking system, better positioned to support lending, mobilise savings, and withstand domestic and global shocks,” the statement said.
The Tide learnt that foreign capital inflows into Nigeria’s banking sector rose by 93.25 per cent year-on-year to $13.53bn in 2025, up from $7.00bn recorded in 2024, amid the ongoing recapitalisation drive by the Central Bank of Nigeria.
Data from the National Bureau of Statistics capital importation report showed that the banking sector remained the dominant destination for foreign capital, accounting for $13.53bn of the total $23.22bn recorded in 2025, representing 58.26 per cent of total inflows, up from 56.81 per cent in 2024.
The surge reflects heightened investor interest in Nigerian banks as they raised fresh capital to meet new regulatory thresholds introduced by the apex bank, with industry-wide recapitalisation activities driving large-scale inflows across all quarters of the year.
However, the Centre for the Promotion of Private Enterprise (CPPE) recently raised concerns over weak credit flows to small businesses despite recent banking sector reforms.
The CPPE, led by a renowned economist, Dr Muda Yusuf, acknowledged that the ongoing bank recapitalisation exercise by the CBN has strengthened the financial system, but warned that the benefits have yet to translate into meaningful support for the real economy.
The facility will be disbursed through participating Microfinance Institutions (MFIs), which will in turn extend the loans to their customers, particularly SMEs, as they directly interface with businesses at the grassroots level.
The Executive Director of COMCIN, Mr. Micheal Ogbaa who represented the Chairman, Dr. Iredele Oyedele (FCA, FCCA), said the initiative is designed to strengthen micro-lending institutions and expand access to finance for grassroots entrepreneurs, particularly women and youths in the informal sector.
Ogbaa explained that COMCIN does not lend directly to individuals but works through its network of microfinance and cooperative institutions, which in turn provide loans to end users.
“We came together to advocate for the microfinance ecosystem. Commercial banks often exclude people at the grassroots, but our members are positioned to reach them. This facility will empower them to do more,” he said.
He noted that the loan scheme offers low interest rates and flexible repayment plans, making it more accessible to small business owners.
According to him, about 90 percent of beneficiaries are expected to be women, who play a key role in sustaining families and driving economic activities at the local level.
“Our focus is on traders, service providers, and players in the informal sector. These are the real movers of the economy. By supporting them, we are strengthening families and contributing to national development,” he added.
Ogbaa disclosed that eligible SMEs with proven integrity and business track records could access up to N5 million each through participating micro-lending institutions. The rollout has commenced in Lagos and will extend to Abuja, Enugu, and other regions, including the South-West, South-East, and North-East.
He said 12 micro-lending institutions have already benefited from the scheme, while 85 applications are currently being processed under the pilot phase.
“Our target is to reach at least 100,000 SMEs nationwide. We are building a platform that connects funding partners with credible micro-lending institutions, creating a reliable channel for financial inclusion,” Ogbaa said.
He added that COMCIN is also working to attract larger funding pools from development finance institutions and private investors, noting that successful implementation of the pilot phase would boost confidence and unlock more capital for SMEs.
“We have seen encouraging testimonies from early beneficiaries. As we demonstrate transparency and efficiency, more institutions will be willing to channel funds through us,” he said.
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