Nigeria’s Energy Crisis: The Impact of Scarce and Expensive Kerosene and Fuel

Nigeria is currently grappling with a severe energy crisis, characterized by the high cost and scarcity of kerosene and fuel, which is having a crippling effect on the everyday lives of Nigerians. The lack of reliable electricity further exacerbates the situation, leaving many communities without power and driving up the cost of running generators, which rely on premium motor spirit (PMS). This issue is not confined to households but extends to small and medium-scale enterprises, which are finding it increasingly difficult to sustain operations.

A Dire Situation for Businesses

The high cost of diesel, primarily used by higher-income individuals and large companies, has also become a significant burden. With many unable to afford diesel, the result is a wave of business shutdowns, job losses, and a stifling of small businesses. The economic ripple effects are profound, impacting not just livelihoods but the broader economic stability of the country.

The Call for Modular Refineries

Experts from the oil-producing regions argue that the solution lies in the development of modular refineries. Fyneface Dumnamene Fyneface, executive director of the Youths and Environmental Advocacy Centre (YEAC) and national facilitator for modular refineries in the Niger Delta, highlights that while some modular refineries are operational and others are under construction, the current production capacity from these and other private refineries like the Dangote Refinery is insufficient to meet national demand. Government-owned refineries remain non-operational, and the Port Harcourt Refinery has yet to meet its production targets, prolonging the energy crisis.

Artisanal Refining and Its Role

Fyneface emphasizes the importance of modular refineries as a more sustainable and legal alternative to artisanal crude oil refining, which, despite its illegality, currently plays a crucial role in alleviating the energy crisis by producing kerosene, diesel, and fuel. He argues that licensing modular refineries would not only discourage illegal refining but also harness the skills and efforts of artisanal refiners to contribute to the formal economy.

Government’s Responsibility

The previous administration had promised to issue special refinery licenses to youths in the Niger Delta, a commitment that, according to Fyneface, the current government needs to fulfill. He asserts that issuing these licenses could significantly address energy poverty, especially in remote and riverine communities without access to traditional fuel sources.

Environmental and Economic Benefits

Licensing modular refineries also offers environmental benefits. It could reduce the widespread pollution caused by illegal refining, decrease pipeline vandalism, and mitigate the impact of soot from incomplete combustion processes. Additionally, modular refineries would create jobs, build infrastructure, and support local economies.

Challenges and Considerations

Despite the potential benefits, there are challenges to be addressed. Chris Finebone, former commissioner of information in Rivers State, notes that while modular refineries can alleviate some supply issues and create jobs, they are limited in the range of products they can produce, often unable to manufacture PMS or aviation fuel. Furthermore, Blessing Nwikina, an information manager and government business analyst, highlights the difficulty modular refineries may face in securing a steady supply of crude oil at a viable cost, given Nigeria’s declining crude production.


Addressing Nigeria’s energy crisis requires a multifaceted approach. The government needs to expedite the licensing of modular refineries and integrate them into the broader energy strategy. This will not only help stabilize the supply of essential fuels but also reduce environmental damage, create jobs, and support economic growth. By leveraging the capabilities of artisanal refiners and ensuring a steady supply of crude oil to new refineries, Nigeria can move towards a more sustainable and self-sufficient energy future.

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