NNPC says its refinery MoU with Chinese firms is a non-binding technical partnership framework, not a contract or spending commitment

The Nigerian National Petroleum Company Limited (Nigerian National Petroleum Company Limited) has clarified the nature of its newly signed Memorandum of Understanding with two Chinese firms, stating that the agreement does not involve any financial commitment or contract award.

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The clarification follows growing public debate over the company’s partnership with Sanjiang Chemical Company Limited and Xingcheng (Fuzhou) Industrial Park Operation and Management Co. Ltd regarding the rehabilitation of the Port Harcourt and Warri refineries.

According to the national oil company, the agreement signed in Jiaxing City, China, on April 30, 2026, represents a technical equity partnership framework aimed at exploring collaboration opportunities rather than initiating immediate spending or project execution.

Nigerian National Petroleum Company Limited explained that the document signed by Group Chief Executive Officer Bashir Bayo Ojulari and representatives of both Chinese firms is a non-binding arrangement intended to guide future discussions.

The company stressed that no funds have been committed for refinery rehabilitation under the current arrangement, adding that the deal does not constitute an award of contract.

A senior official of the company, who spoke on condition of anonymity, said the understanding simply establishes a platform for dialogue on potential cooperation in financing, operations, maintenance, petrochemical expansion and gas-based industrial development.

The official described recent public interpretations of the agreement as misleading, insisting that the company has not entered into any new spending cycle for refinery rehabilitation.

He explained that the long-term plan being considered involves evaluating a possible incorporated joint venture structure with strategic investors who can contribute both technical expertise and financial capacity.

According to him, any future arrangement will be guided strictly by commercial viability and shared risk principles rather than government-funded intervention.

The official further stated that since 2025, no new refinery rehabilitation project has been approved or financed by the company under its current leadership structure.

He also noted that the Petroleum Industry Act prevents the organisation from relying on direct government funding, reinforcing its shift towards commercially driven partnerships.

The clarification comes amid ongoing scrutiny of Nigeria’s refineries, including Port Harcourt, Warri and Kaduna, which have consumed billions of dollars in rehabilitation costs over the years with limited operational stability.

Industry observers have continued to question transparency and value delivery in previous refinery rehabilitation efforts, while the company maintains that a new performance-based partnership model is now being adopted.

Under the proposed framework, partners are expected to bring capital, technical expertise and operational responsibility, with returns tied to actual refinery performance.

The national oil company insists that the approach is designed to eliminate inefficiencies and reduce long-standing financial losses associated with refinery operations.

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As discussions continue, attention remains fixed on whether the new technical equity model will finally deliver sustainable results for Nigeria’s refining sector.