ABUJA, Nigeria — Nigeria’s refinery owners have called for urgent presidential intervention to establish a predictable naira-for-crude framework and commercially viable domestic crude pricing system, warning that continued structural constraints could undermine investment in local refining and keep the country exposed to imported petroleum products.
The Crude Oil Refinery Owners Association of Nigeria (CORAN), in a position paper released at the weekend, urged the Federal Government to convene a Presidential Refining Industry Roundtable involving refiners, crude producers, regulators, the Nigerian National Petroleum Company Limited (NNPC), financial institutions, infrastructure investors and relevant government ministries.
The association said the roundtable should produce a clear and time-bound roadmap for resolving the financing, crude supply, pricing and infrastructure bottlenecks confronting Nigeria’s emerging refining industry.
At the centre of CORAN’s proposals is the full institutionalisation of the Naira-for-Crude initiative, which it described as essential to reducing the foreign-exchange risks faced by domestic refiners that predominantly sell petroleum products in naira.
“Naira-for-Crude should become an industrialisation policy rather than an episodic intervention,” the association said.
Refiners Seek Predictable Crude Pricing
CORAN said improved physical crude allocations to domestic refineries in the second quarter of 2026 were encouraging but insufficient to guarantee the long-term viability of the refining sector.
The association argued that the critical issue was not simply whether crude was allocated to local refineries, but whether it could be delivered under commercially sustainable terms.
It said domestic crude pricing should reflect factors including crude quality, delivery location, transportation and evacuation costs, avoided international freight and insurance expenses, financing requirements and reasonable commercial margins for producers.
The association noted that refiners frequently incur additional costs transporting crude by road, barge and pipeline, adding that such expenses must be incorporated into pricing arrangements if domestic refining is to remain competitive.
CORAN therefore proposed a transparent domestic crude pricing mechanism that takes account of the economics of supplying Nigerian crude to local refineries rather than applying arrangements designed primarily around export markets.
Naira-for-Crude Seen as Investment Catalyst
The refinery owners argued that forcing domestic refiners to purchase crude in foreign currency while selling most refined products domestically in naira creates a currency mismatch that can increase operating risks and discourage investment.
They called for qualified domestic refineries—including modular and emerging operators—to be allowed to access Nigerian crude under a transparent framework and settle eligible transactions in naira.
For CORAN, such a system would go beyond short-term fuel-market intervention and become an industrial policy tool capable of supporting refinery investment, reducing foreign-exchange exposure and retaining more value within Nigeria.
The association also called for stronger implementation of the Domestic Crude Supply Obligation (DCSO), including clear rules that provide refiners with greater certainty over volumes, pricing and delivery arrangements.
Imports Could Undermine Refinery Investment
CORAN also raised concerns over continued imports of refined petroleum products, arguing that excessive reliance on foreign supplies could weaken incentives for investment in domestic refining capacity.
The association acknowledged that imports would remain necessary when domestic production cannot meet national demand or when temporary supply disruptions occur.
However, it said imports should increasingly function as a balancing mechanism rather than the structural foundation of Nigeria’s downstream petroleum market.
According to CORAN, prolonged dependence on imported products exposes Nigeria to international freight costs, foreign-exchange pressures and geopolitical disruptions while effectively exporting jobs and refining margins.
A stronger domestic refining sector, it argued, would allow Nigeria to retain more value from its crude resources and stimulate investment across transportation, engineering, fabrication, petrochemicals, lubricants, plastics and construction.
Refiners Demand Long-Term Financing
Financing remains another major constraint, particularly for new refineries and operators seeking to expand existing facilities.
CORAN proposed a Refinery Development and Expansion Financing Framework involving development finance institutions, commercial banks, pension funds, infrastructure funds and private investors.
The framework, it said, should provide longer-tenor financing, credit guarantees, refinancing windows and construction-risk support to improve the bankability of refinery projects.
The association also called for greater investment in pipelines, storage terminals, depots, rail-linked logistics and marine evacuation infrastructure.
It argued that Nigeria’s heavy reliance on road transportation for crude and petroleum products was increasing costs for refiners and consumers while accelerating road deterioration and increasing accident risks.
Government Urged to Treat Refining as Strategic Infrastructure
CORAN urged the Federal Government to treat refining as strategic industrial infrastructure rather than simply another segment of the downstream petroleum industry.
It said a competitive domestic refining industry could strengthen energy security, conserve foreign exchange, create industrial jobs and support the development of an integrated petroleum and petrochemical value chain.
The association also proposed commercially viable crude swaps, shared infrastructure and refinery expansion programmes as part of a national strategy to position Nigeria as a major refining hub for Africa.
It said Nigeria could develop an integrated ecosystem of large, medium-sized and modular refineries located close to crude-producing regions and major centres of consumption.
The association’s central argument is that Africa’s largest crude oil producer should no longer remain structurally dependent on exporting crude while importing significant quantities of the petroleum products derived from it.
Dangote Refinery IPO Adds Momentum to Downstream Investment
CORAN’s call comes as Nigeria’s refining industry enters a new phase of investment and capital-market activity, led by the 650,000-barrel-per-day Dangote Petroleum Refinery.
The refinery is expected to sign its initial public offering documentation on Monday in Lagos, according to industry sources.
The Securities and Exchange Commission has approved the proposed offering by Dangote Petroleum Refinery and Petrochemicals FZE, paving the way for the next stage of the transaction.
The proposed offer comprises 4.1 billion ordinary shares at N525 each, which could raise approximately N2.15 trillion if fully subscribed.
The SEC has also registered the company’s existing 120.13 billion ordinary shares.
The transaction is expected to be one of Nigeria’s most significant capital-market deals and would provide investors with an opportunity to take exposure to one of the country’s largest industrial projects.
Dangote Group founder Aliko Dangote is reportedly targeting a valuation of about $50 billion for the refinery and plans to offer up to a 10 per cent stake, potentially raising about $5 billion, although the company’s valuation expectations and the eventual transaction structure remain subject to the offering process.
Since beginning operations, the Dangote refinery has become a major force in Nigeria’s downstream market, increasing domestic refining capacity and reducing the country’s historical dependence on imported fuels.
Nigeria Faces Refining Policy Test
The developments underline a broader policy challenge for Nigeria: ensuring that new refining capacity is supported by a crude-supply, financing and logistics framework capable of making the investments commercially sustainable.
CORAN said the proposed presidential roundtable should establish measurable timelines for institutionalising Naira-for-Crude, strengthening the DCSO, creating a domestic crude pricing template and developing sustainable financing mechanisms.
It also wants the government to address crude swaps, shared infrastructure, refinery expansion and other bottlenecks that could prevent Nigeria from fully exploiting its refining potential.
For investors, the outcome could determine whether Nigeria’s refining revival develops into a competitive industrial ecosystem or remains constrained by the same supply, pricing, financing and infrastructure weaknesses that have historically limited domestic refining.
With crude production, refining capacity and downstream investment increasingly interconnected, CORAN’s demands place predictable access to feedstock and commercially viable pricing at the heart of Nigeria’s next phase of energy-sect
