We can’t build refineries in Nigeria because it does not make business sense says Shell; thoughts?

Shell Petroleum Development Company’s (SPDC) Executive Director, Mr. Malcolm Brinded recently said that the company cannot build a refinery in Nigeria because there are surplus refineries across the world. As a result, the investment case for building a refinery in Nigeria does not make good business sense.

According to him:

“I will also say because of the surplus of refineries available in a way, one has to look very closely whether building new refineries is a good investment for anyone not just for Shell but for countries involved.

“In today’s world, not looking at the past but where we are today, there is surplus of refinery capacity which essentially means many refineries in the world run at a loss. “Which also means one can get refined products back again and pay very little for it to be refined,” he said.

Mr. Brinded made this statement recently while speaking to State House Correspondents in Abuja.

Many Nigerians have responded emotionally to the comment as it indicates that few investors will be interested in investing in building refineries in Nigeria.

What are your thoughts?

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7 thoughts on “We can’t build refineries in Nigeria because it does not make business sense says Shell; thoughts?

  • Mba Clement

    (March 3, 2012 - 9:13 pm)

    Mr Malcolm Brinded should be fired. He talks like an unwise business man.If Shell builds a refinery in Nigeria,it will be the only working refinery in Nigeria.That will be a good investment for them as they stand to gain alot from it as do Nigerians. We need wise men at the helm of affairs, not educated politicians.

    • John League

      (March 17, 2012 - 6:39 pm)

      Shell and other gas companies want the cost of fuel to be high so there is greater profit margins and why build a refinery when the costs are huge to start construction, and maintenance when you ship it to Texas or South America and refine it cheaper than sell it at a higher price of which it was sold out of Nigeria.

      I do understand that there has to be descent infrastructure for Nigeria to be a economic power, but building more gas fields or refineries is not going to be a long term solution and brings more corruption into Nigeria something they do not need any more of.

      And I do find t an out rage that Nigeria is paying the same price (with the removal of fuel subsidies) as the Mid west in America, which is low for them because of Canadian oil sands and the oil refineries of Texas. Now you may say that because of the refineries in Texas ensures low prices , well wrong it dose not it is the geographic situation of Texas which allows for oil from South America to get Refined under the stable hands of the US. it also allows Canada to keep good FP with the US and keep in line with Green codes.

  • jack

    (March 4, 2012 - 11:59 am)

    Mr. Malcolm should be sent packing. He wants a situation where Nigeria will continue to import (from foreign land) petroleum products to the detriment of Nigerians.

  • Seun Osewa

    (March 4, 2012 - 3:35 pm)

    Mr. Malcolm probably understands the oil business better than all of us. I would listen.

  • Noac Nonso

    (March 4, 2012 - 7:21 pm)

    It will interest you to know that many operators of oil and gas industry in nigeria including shell have refineries all over the world,where they take our crude oil to.According to malcom their are several refineries around the world and most of them are running at lost what an national insult? crude oil is a composition of many fractions of petroleum products,hence it is economically beneficial and more lucrative to deal in crude oil exploration,than stock and deal in refining processes.I am very optimistic that by the time the national assembly pass the famous petroleum industry bill ( PIB),it will address so many abnormallies in oil and gas.

  • Lékan

    (March 7, 2012 - 10:41 am)

    F**K SHELL AND ITS NIGERIAN COLLABORATORS!!!!!!!!!!!!!!!!

  • Unbeatable

    (March 9, 2012 - 5:06 pm)

    Mr Malcohn are u seriously kidding me? but building refinery in your country is a good business sense yeah? OMG may God save us from all this foreigners that tend to be friendly but just drilling our innocence mocking us in return why should our crude be exported then we buy it back? does it make any sense? wont having it here solve unemployment problem? If this oil was in your country will you all be importing it to Nigeria? Nigeria, Africa arise from this slavery mentality this people are causing more harm than good black is a colour and not a MENTAL ISSUE please.

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