From modular to mega: Nigeria’s refining shift

February 26, 2026

Momoh Oyarekhua, founder and chairman of OMSA Group, talks to The Energy Year about scaling OPAC Refineries amid shifting crude supply dynamics and Nigeria’s emergence as a regional refining hub. OMSA Group operates OPAC Refineries and is advancing a diversification strategy spanning oil, gas and renewable energy.

How do you see Nigeria’s downstream evolving with the emergence of both mega and modular refineries?
Our vision has always been to make Nigeria a net exporter of petroleum products, and we are finally seeing that aspiration take shape. For decades, the country has been a net importer, but that narrative is now shifting – particularly with the commissioning of Dangote’s large-scale refinery. The Dangote Refinery – alongside ours and other modular units – is evidence that we are no longer just talking the talk, but walking it too.
We foresee a future where Nigeria not only meets its domestic demand but plays a major role in regional exports. In fact, many of our refineries, directly or indirectly, are already exporting products. Whether it’s fuel oil, gasoil or aviation fuel, Nigerian refiners are increasingly contributing to international supply chains.
There is also strong momentum around upgrading capacities. Across the country, refineries are expanding, and in our case, we are moving from a 10,000-bpd facility – a proof of concept – toward a target of 60,000 bpd. The downstream sector is entering a phase of innovation, growth and bold investment.

How are you scaling up production at OPAC Refineries?
Our goal from day one was to reach 60,000 bpd. The current 10,000-bpd operation is only the first phase, but crude supply has been a limiting factor. Thankfully, with initiatives such as the naira-for-crude policy and the 15% import tariff on petroleum products, the environment is starting to change. We’re also working closely with the National Assembly to enable regulations that will make crude supply more consistent for indigenous refiners like us.
As part of our strategy, we’re conducting internal audits and re-evaluating the business model to optimise the refinery. We’re engaging with global technology companies such as Honeywell and looking at how best to phase the expansion. We believe that with a more stable feedstock supply, we’ll see a swift scale-up in operations.
Private investment in refining was rare in Nigeria until recently. Many shied away from the space due to the high risks. But we chose to enter it, and we’re proud to say that we’re producing and exporting from Nigerian soil.

 

What impact is local refining having on job creation, economic resilience and community development?
Local refining brings immense benefits. First and foremost, it creates jobs for Nigerians. Beyond direct employment at the plant, it spurs auxiliary businesses – logistics, catering, maintenance and other services – in the host communities. When a refinery comes into a locality, it becomes an economic engine.
On a national scale, the impact is just as powerful. Up until recently, 40-50% of Nigeria’s foreign exchange was used to import petroleum products. With local production, that demand has sharply declined, reducing pressure on the naira and improving currency stability.
The money that would have gone abroad now circulates within the local economy. Moreover, skills are being developed across the refining value chain – from engineering to operations – and this capacity building is crucial for long-term sustainability.
Local refining also enhances our energy security. If there’s a global crisis like Covid again, Nigeria must not be at the mercy of international suppliers. We should be able to meet our needs locally. Crude oil is only useful when refined. We must build capacity to process it here.

What is Nigeria’s role in meeting regional demand, and could it evolve into a continental refining hub?
Nigeria is already becoming a refining hub for Africa. We’re seeing a decline in imports arriving at Lomé, for example, which is a key sign that local production is displacing foreign supply. With Dangote planning to ramp up to 1.4 million bpd and modular refiners scaling in parallel, West Africa is gradually shifting its source of refined products to Nigeria.
Global traders such as Trafigura and Glencore are now sourcing from within Africa. This intra-African trading not only saves on freight costs but it also reduces environmental impact. Shipping products from Asia or Europe emits significant CO2. Sourcing from Nigeria allows cleaner, faster and cheaper distribution across the region.
We are moving towards a future where Nigeria will be a source of refined products across the continent. We are already supplying across West Africa, and as capacity grows, that footprint will only expand.

What’s the strategy for OMSA’s transition into a diversified energy company by 2030?
We’re advancing our 2030 vision aggressively. First, we’ve expanded into the upstream – I currently sit as chairman on the board of a company operating in OML 95. This vertical integration ensures feedstock security for our refining operations and aligns with our long-term strategy.
We’re also investing in renewables. A major initiative underway is the development of carbon solar panels, which offer higher efficiency and better environmental performance than traditional panels. We’re in the final stages of designing our go-to-market strategy and plan to manufacture these panels locally in Nigeria, targeting both domestic and regional markets.
Alongside that, we’re also scaling up our gas business and integrating it with our broader renewable energy offering. All of this supports our ambition to become a fully diversified energy company by the end of the decade. It’s about building sustainability in every segment – from oil to gas to renewables – and positioning OMSA as a leader in Nigeria’s energy future.

Read our latest insights on:

• Nigeria