Former President Umaru Musa Yar’Adua cancelled the controversial sale of the Port Harcourt Refinery to a consortium led by billionaire businessman Aliko Dangote. The deal, which had been signed during the final days of President Olusegun Obasanjo’s administration, was seen by many as a major conflict of interest and a breach of the country’s privatisation laws. The decision by Yar’Adua, according to reports from the Alliance on Surviving Covid-19 and Beyond (ASCAB), was based on concerns that the transaction did not serve the best interests of the Nigerian people.
The revelation comes from a statement by Femi Falana, the renowned human rights lawyer and ASCAB Chair, who highlighted that the initial sale was deeply controversial due to the involvement of multiple parties with vested interests in the deal. Falana, in his statement, shed light on the web of connections surrounding the consortium Bluestar Oil, which had acquired a 51% stake in the Port Harcourt refinery for $561 million, a sum many believed was far below the asset’s true value. Bluestar Oil, according to Falana, was not just any ordinary group of investors—it was a consortium that included Dangote Oil, Zenon Oil, and Transcorp, three influential players in the Nigerian oil sector.
The story takes a deeper twist when it is revealed that former President Obasanjo, in the final days of his tenure, had sold off large shares in Transcorp, one of the companies in the Bluestar consortium, through what he referred to as a “blind trust.” This sale raised eyebrows for its potential conflicts of interest. According to Falana, it was a decision made by Obasanjo to bypass constitutional processes, particularly ignoring the involvement of then Vice President Atiku Abubakar, who, under the law, was supposed to chair the National Council on Privatisation (NCP).
Falana further disclosed that the privatisation process was rushed, with the deal for Port Harcourt’s sale being signed on May 17, 2007, only days before Obasanjo left office. In the same period, a similar sale was conducted for the Kaduna Refinery, with Bluestar acquiring a 51% stake for a mere $160 million. This rapid-fire privatisation of vital national assets raised serious questions about its legitimacy. Both major oil unions, the National Union of Petroleum and Natural Gas Workers (NUPENG) and the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN), vocally opposed the deals, pointing out that the Port Harcourt refinery’s value was grossly understated, and the nation was being robbed.
The unions took their fight to the streets, culminating in a strike in June 2007 that nearly crippled the Nigerian economy. Falana added, “The unions, after a four-day strike, had assurances from the federal government that a full investigation would take place regarding the legitimacy of the deals.” The protests were powerful enough to force the government to reconsider the sales.
When Yar’Adua assumed office, he ordered a thorough investigation into the privatisation of both the Port Harcourt and Kaduna refineries. After reviewing the findings, the new president made a bold decision—reversing the privatisation process, a move that drew both applause and criticism. Falana stressed that Yar’Adua’s cancellation was carried out according to the letter of the law, with no legal challenge against the action. This decision signified a strong stand against the unethical sale of national assets for personal gain.
“It was on record that the cancellation of the privatisation was not challenged in any court,” Falana stated, underscoring that the action was in line with national interest, as well as the stipulations of the Privatisation and Commercialisation Act.
The cancellation marked a significant turning point for the nation’s oil sector, which had long been embroiled in controversy over privatisation deals. But the journey to uncover the truth didn’t end there. Falana called on the unions, NUPENG and PENGASSAN, to continue their vigilance in protecting national interests in light of renewed efforts by certain powerful figures to push for the privatisation of Nigeria’s refineries once again. He remarked, “Those calling for the privatisation of the nation’s refineries should instead focus on setting up their own refineries, just like the Dangote Group, if they believe in private ownership.”
Falana’s statement has reignited debates over Nigeria’s approach to privatisation and the management of its national resources. His account brings to light the deeply rooted concerns about the fairness and transparency of such deals. Critics have long argued that privatisation efforts in Nigeria have often been tainted by corruption, lack of proper due diligence, and conflicts of interest that ultimately harm the Nigerian people.
Interestingly, former President Obasanjo himself has commented on the matter in recent interviews, revealing a different side to the story. Speaking on Channels Television, Obasanjo disclosed that Dangote had initially proposed a public-private partnership (PPP) model to manage Nigeria’s refineries in 2007. Dangote reportedly offered $750 million to take control of the management of the Port Harcourt, Warri, and Kaduna refineries, a proposal that the Nigerian National Petroleum Corporation (NNPC) rejected, despite the corporation’s admission of its inability to manage the refineries effectively. According to Obasanjo, Dangote’s offer was ultimately turned down by the NNPC, despite its poor track record of refinery management.
It was only after this rejection that Dangote and his partners decided to explore alternative routes to secure ownership of key assets in the oil sector, eventually leading to the controversial Bluestar Oil consortium and the sale of shares in the Port Harcourt and Kaduna refineries.
While Obasanjo’s comments provide a glimpse into the complex dynamics of Nigeria’s oil sector, it is clear that the legacy of those privatisation deals continues to be a point of contention. The Yar’Adua administration’s decision to cancel the sale was an attempt to shield Nigeria’s oil assets from what many saw as a high-stakes game of corporate control driven by political interests.
